REITs Offer Hedge Against Elevated Tech Stock Valuations, Strategist Says

Scott Crowe, chief investment strategist at CenterSquare Investment Management, was a guest on the latest edition of Nareit’s REIT Report podcast.CenterSquare recently published a report, “The REIT vs. FAANG Valuation Showdown.” It notes that the current valuation of FAANG (Facebook, Apple, Amazon, Netflix, and Alphabet’s Google) stocks roughly equate to $3 trillion of total equity value, versus $5.8 trillion for the entire U.S. institutional real estate market.“Essentially the choice that the market is giving investors today is, would you rather own the five most popular tech stocks in America, or half of all the commercial real estate in this country?” Crowe said. While FAANG stocks are interesting and dynamic, the largest tech companies of today may not be at the top a decade from now. Real estate, however, is still going to be around to house the companies of the future, he noted.