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Annaly Capital Slides on Secondary Offering

Stocks in this article: NLY IYR VNQ HCP AGNC

HCP had previously said it would offer 31 million shares, but strong investor demand led the medical REIT to up its offering.

It raised around $1.47 billion, funds it will use along with cash on hand to finance its $6.1 billion acquisition of privately owned HCR ManorCare. The acquisition of 338 post-acute, skilled nursing and assisted living facilities was inked in mid-December.

HCP shares lost 0.9% to $37.06 on Tuesday.

American Capital Agency (AGNC) said in early December it agreed to sell 8 million of its common shares in a secondary offering to raise $219 million, plus an option for an additional 1.2 million shares to cover overallotments.

AGNC said it intends to use the capital to acquire additional agency securities as market conditions warrant and for general corporate purposes.

American Capital shares were 1% lower at $28.40 Tuesday afternoon.

Stocks in the real estate investment trust sector outperformed the S&P 500 in 2010 and are expected to deliver 9% to 11% in total returns in 2011, according to analysts at Keefe, Bruyette & Woods.

"REITs are back on offense and all eyes are on growth," said KBW's Sheila McGrath, "growth prospects for core portfolios, growth from acquisitions and growth in dividends ."

Morningstar (MORN) noted that REITs have been catching on with a number of exchange-traded fund investors who consider them as potential hedges against inflation. The investment research firm pointed to inflows of $312 million to the iShares Dow Jones U.S. Real Estate (IYR), and $371 million of net inflows to the Vanguard REIT Index (VNQ) in the third quarter as evidence of the growing interest in REITs.

-- Written by Miriam Marcus Reimer in New York.



>To contact the writer of this article, click here: Miriam Reimer.

>To follow the writer on Twitter, go to http://twitter.com/miriamsmarket.

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Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.
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