COMPARING THE INDEXES
Although the S&P 500 has experienced greater highs, it has also fallen to lower lows over the past 15 years. Real estate investments, on the other hand, have provided steady returns. The NAREIT Price Index, for example, has averaged a 10.08% return over 15 years, a hair less than the S&P 500's 15-year return of 10.86%.
| 1 Year | 10 Years | 15 Years | Beginning Date | |
|---|---|---|---|---|
| NAREIT Price Index | 16.22% | 12.70% | 10.08% | 1984 |
| Lehman Government Bonds | 8.81% | 7.12% | 7.51% | 1984 |
| NCREIF Index | 5.60% | 8.54% | 6.81% | 1977 |
| T-Bills (3-month) | 2.46% | 4.58% | 5.32% | 1977 |
| S&P 500 Index | -17.98% | 11.46% | 10.86% | 1977 |
| Source: NCREIF, S&P 500 Corp., Lehman Bros., BEA, NAREIT, Real Estate Research Corp. | ||||
Insight from: demographics
FORTUNE 500 MAGNETS
The number of Fortune 500 companies is a strong indicator of a city's long-term vibrancy. New York tops the list with 40 Fortune 500 headquarters as of 2001. The chart below ranks the top 10 cities with the most Fortune 500 headquarters in 2001 vs. 1991.
| 2001 | No. of headquarters | 1991 | No. of headquarters |
|---|---|---|---|
| 1. New York | 40 | 1. New York | 39 |
| 2. Houston | 20 | 2. Chicago | 19 |
| 3. Atlanta | 12 | 3. Houston | 16 |
| 4. Chicago | 11 | 4. Dallas | 12 |
| 5. San Francisco | 9 | 5. Cleveland | 11 |
| 6. Philadelphia | 8 | Pittsburgh | 11 |
| 7. Charlotte, N.C. | 7 | 7. Stamford, Conn. | 9 |
| Cleveland | 7 | 8. Minneapolis | 8 |
| St. Louis | 7 | St. Louis | 8 |
| 10. Birmingham, Ala. | 6 | 9. Los Angeles | 7 |
| Boston | 6 | 10. Atlanta | 6 |
| Cincinnati | 6 | Richmond, Va. | 6 |
| Dallas | 6 | ||
| Milwaukee | 6 | ||
| Minneapolis | 6 | ||
| Pittsburgh | 6 | ||
| *The Fortune 500 is a revenue-based ranking compiled by Fortune magazine. | |||
| Source: Fortune April 15, 2002; Fortune April 20, 1992. | |||
NEIGHBORHOOD GIANTS
It's no secret that Simon Property Group is the largest mall REIT in the U.S. with a market cap of $6.6 billion. But in the neighborhood shopping center category, Kimco Realty Corp. is the king of the hill with a market cap of about $3.25 billion. The combined equity market cap of the 26 REITs tracked in the neighborhood shopping center niche is $18.36 billion, of which Kimco comprises 17.7%.
| Company | Symbol | Market Cap (in billions) | Market Cap Percentage of Total Subsector |
|---|---|---|---|
| Kimco Realty Corp. | KIM | $3.25 | 17.7% |
| Weingarten Realty Investors | WRI | $1.90 | 10.3% |
| New Plan Excel Realty Trust Inc. | NXL | $1.79 | 9.7% |
| Regency Centers Corp. | REG | $1.78 | 9.7% |
| Developers Diversified Realty Corp. | DDR | $1.43 | 7.8% |
| Source: National Association of Real Estate Investment Trusts (NAREIT) | |||