Summit has released its updated non-listed REIT Total Fee Burden analysis for September 2016 with the addition of three new non-listed REITs including Blackstone Real Estate Income Trust. Summit's Total Fee Burden shows the impact of all fees as a percent of gross equity over a five-year time period to highlight the true fee cost for investors. Fee analysis should be an important part of any investor evaluation of a non-listed REIT.
Non-listed BDCs ended three quarters of losses with a high 7.6% quarterly return in 2Q16. The trailing twelve month return for non-listed BDCs remains negative at -1.6%.
Non-listed BDC fundraising declined to $500 million in 2Q16, which is the lowest quarterly total in four years. FS Energy & Power was the top fundraiser with $197 million in 2Q16.
Non-listed BDCs reported lower secured debt and first lien debt ratios of 76% and 50%, respectively, in 2Q16. First lien yields declined from 7.7% to 7.3% in 2Q16.
Non-listed REITs raised only $1.1 billion in 2Q6, which is the lowest quarterly capital raise in 12 years. Jones Lang LaSalle Property Trust led all non-listed REITs with a $160 million capital raise in 2Q16.
Non-listed REITs achieved a milestone in 2Q16 with 52% of equity capital raised in modified commission shares, such as Class T and Class I shares. This is first quarter that modified commission shares represented the majority of equity capital raised.
Non-listed REITs had a record low 5.8% acquisition cap rates for 2Q16 YTD. Interest rates on new permanent debt financing increased to 3.8% for 2Q16 YTD, which could indicate higher acquisition cap rates in future quarters.
The Summit dNAV REIT Return Index reported a 1.27% quarterly return in 2Q16, as dNAV REITs returned to positive returns after a 0.02% quarterly loss in 1Q16. dNAV REITs should post positive returns in 2016 but will likely be below the 8.48% return in 2015.
Several real estate interval funds filed their semi-annual financial reports this summer with interval funds focused on investing in private real estate funds or residential mortgages continuing to report strong and stable investment returns.
Summit Investment Research's NAV Summary for open non-listed REITs highlights NAVs and key DCF assumptions for nine open non-listed REITs. Most open non-listed REITs have NAV growth consistent with overall market price increases, but two hotel non-listed REITs have significantly higher NAV increases than the overall market.