The Quiet Strength of REITs in 2026

U.S. and global REITs are entering a more durable recovery as improving fundamentals, attractive valuations and broader market participation reduce their dependence on interest-rate movements.

• Through August 2026, U.S. REITs returned 16.7% year to date in USD, outperforming the S&P 500 at 13.1% and the MSCI World Index at 13.4%; global REITs returned 9.8%.
• The U.S. 10-year Treasury yield rose from approximately 4.2% to 4.8%, yet the weekly correlation between yield changes and U.S. REIT returns weakened from -0.45 in 2022-2024 to -0.21 from the start of 2025 through August 2026; the R² fell from 0.20 to 0.05.
• Global new-property supply is historically low and expected to decline over the next 24 months, while U.S. REIT occupancy reached 93.8% in the second quarter of 2026, its highest level in four years; same-store net operating income grew 3.8% in the first quarter.
• The recovery has broadened beyond data centres to hotels, retail, industrial properties and gateway-city offices, including New York, while U.S. REIT funds from operations grew materially year over year in the first quarter.
• Relative global REIT valuations remain near decade lows on price-to-cash-flow and EV/EBITDA measures, while U.S. REITs repurchased $3.2 billion of stock in the first quarter and eight M&A transactions through June totalled $58 billion.

Takeaway: Hazelview sees global REITs, especially U.S. REITs, as compelling after depressed trailing 10-year returns, although monetary policy and geopolitical developments could still affect short-term performance and valuation dispersion.