Why Federal Realty Investment Trust Shares Dropped 36% in March
Shares of real estate investment trust (REIT) Federal Realty Investment Trust (NYSE: FRT) fell a painful 35.9% in March according to data from S&P Global Market Intelligence. That was materially worse than the broader market, where the S&P 500 Index declined around 13%, and the average REIT, as measured by Vanguard Real Estate ETF, which was down 20%. The big reason for all of these declines was COVID-19. The fall at Federal Realty was driven by the fact that the quickly spreading illness could have long-term implications for its business.
Federal Realty is often touted because of its mixed use centers that bring retail, apartment, and office/work assets together in one place. That is a material and important part of its business (about 36% of net operating income), but at its core it is still basically a retail REIT. That said, it has a focused portfolio of well-located properties and is highly regarded on Wall Street. Still, COVID-19's impact could materially upend even the best-positioned retail properties.
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Source Fool.com
