10 Best Real Estate and Realty Stocks To Buy According to Hedge Funds

6. Avalonbay Communities, Inc. (NYSE:AVB)

Number of Hedge Fund Holders: 42

Avalonbay Communities, Inc. (NYSE:AVB) is a multifamily REIT that develops, redevelops, acquires, and manages apartment homes in some of the top markets across 12 US states and Washington, DC. The company focuses on metropolitan areas with vibrant quality of life, low housing affordability, and strong employment growth.

With a solid market capitalization of $29.71 billion and a net income margin of 29.41% exceeding the industry average, the firm occupies a strong presence in the multifamily housing sector. The company owns a well-established portfolio of 281 apartment communities with more than 87,000 units. This portfolio is focused on coastal markets that have delivered solid same-store net operating income (NOI) growth. Although the firm faced a setback during the pandemic when people chose rural and suburban areas over cities, it has been resilient. Speaking of now, the second quarter of 2024 marked turnover well below historical levels which supported healthy occupancy for the REIT.

During the year’s second quarter, Avalonbay Communities was successful in beating revenue expectations. The company heavily favored from market conditions such as the strong inclination towards renting rather than buying a home and the low new supply in the firm’s suburban coastal markets. The company’s development activity remains robust as it completed the development of 3 communities comprising 901 apartment homes during the three months ended June 30. It also had 17 consolidated Development communities under construction which will contain 6,066 apartment homes and 65,000 square feet of commercial space which shows the drive for growth in the future.

Avalonbay Communities, Inc. (NYSE:AVB) ranks among the 10 best real estate and realty stocks according to hedge funds. The coastal-focused portfolio and superior competitive position among other multifamily residential REITs make the company a good option to be considered.