During this period of global uncertainty, PGIM Real Estate is leveraging the breadth of its integrated global platform – closely monitoring public real estate market trends to capitalize on timely opportunities and assess the direction of the industry overall. PGIM Real Estate has approximately $3 billion in public real estate assets under management through its Global Real Estate Securities division and is well-positioned through active management to benefit from the significant dispersion in sub-sector performance that is shifting daily within this volatile environment.
Assessing the Global Implications
On the global scale, uncertainty around the duration of the economic shutdown and the shape of the recovery remain the main barriers to positive investor sentiment. REITs sold off by more than 28% during the first quarter of 2020, a drop that was similar in
magnitude and speed to that of the global financial crisis but is more pronounced because of the closure of social gathering-oriented real estate in most parts of the world.
Global REITs are currently trading at discounts of 20 to 60% to pre-crisis Net Asset Values (NAV). Additionally, formerly defensive property types such as assisted living have been negatively impacted by the virus, which is unique to this downturn. April rent collection, however, was stronger than expected for apartment REITs, office REITs, and net-lease REITs.