PARSIPPANY, N.J. The percentage of U.S. commercial property owned by public real estate companies in 2000 dropped from a year earlier, despite the companies rising share prices, according to a study released last week by Prudential Real Estate Investors.
The annual study looked at the percentage of properties in six categories that were majority owned by real estate investment trusts and real estate operating companies. Last year the percentages fell in all six categories, ranging from a 30-basis-point dip in nonmall retail (to 13.2%) to a 220-basis-point drop in mall retail (to 34.1%).
The overall decrease was the first since Prudential began tracking public ownership of U.S. commercial real estate four years ago.
A number of factors brought about the ownership decline, including a short supply of capital, according to the study. The industry raised only $10 billion of cash from external public sources in 2000, the lowest amount since 1992.
Although REITs performed well in 2000, many sectors of the public equities market fell sharply, said Youguo Liang, the managing director of research at Prudential Real Estate Investors. The collapse of such high-growth sectors as the tech sector led investors to search elsewhere for yield and value.
The ownership rates could bounce back this year, because more of these companies are trying to raise equity in secondary offerings, Mr. Liang said. In the first five months of this year REITs raised two-thirds as much new financing as they did all of last year, he said.