Nareit Research

  • Economy and CRE Markets Slowing Back to Trend in Second Half of 2019
    Economic growth in the first half of the year wasn’t great, but was probably better than most had expected at the start of the year, and commercial real estate markets and REITs benefited from the growing economy. Nareit economist Calvin Schnure provides his analysis of the outlook for the rest of the year in this economic outlook.
  • REIT Outlook and Top Real Estate Issues to Watch for in 2019
    The next year is likely to be a good but not great one for real estate, with solid job growth, consumer spending and business activity driving demand for nearly all types of commercial real estate.
  • REITs: A Look Back at 2018 and a Look Forward to 2019
    At the beginning of 2018 REITs were undervalued and poised for outperformance. At the end of the year both statements were still true—but less so, because the outperformance has begun.
  • Estimating the Size of the Commercial Real Estate Market in the U.S.
    Nareit estimates that the 2018 total dollar value of commercial real estate was between $14 and $17 trillion, with a mid-point of $16 trillion. This study was conducted primarily using data from CoStar and other sources.”

  • 2019:Q2 Commercial Property Update
    Commercial real estate markets saw mixed results in Q2, with tightening in apartment and office sectors and softening for retail and industrial. The macroeconomy lost some momentum as the initial boost from the 2017 tax cuts faded. As the economy returns to trend, there are few signs of either overheating or a recession in the near future.
  • mREIT White Paper
    The mREIT sector has grown rapidly in the aftermath of the Great Financial Crisis (GFC), and the composition of the sector has changed as well. This Nareit White Paper provides background on the sector and how it has evolved. Key findings include that mREITs helped stabilize and recapitalize the home mortgage sector following the GFC by raising $76 billion of equity capital and investing in both Agency and non-Agency MBS.
  • REITs and Real Estate Outlook for 2018
    The macroeconomy and real estate markets had a good performance in 2017. Real GDP rebounded to annualized growth rates above 3.0 percent in the second and third quarters. Commercial properties in most markets enjoyed sustained growth of demand, high occupancy rates, rising rents and rising prices. These advantageous conditions may well continue into 2018, but there are several risks that might cause a change in the outlook.
  • 80 Million Americans Own REIT Stocks
    This research note estimates the number of American households and Americans that own REIT stocks directly or indirectly through mutual funds, ETFs or target date funds. We estimate that approximately 80 million adult Americans, or roughly 40 percent of American households, own REIT stocks.
  • Economic Fundamentals for Office Properties and Shifts in REIT Portfolios from 2007-2017
    A Nareit research paper by Alexandra Thompson examines office property markets. The analysis finds that office REITs have increased their holdings within secondary cities since 2012, in order to benefit from robust population and employment growth, and increase returns for investors.
  • What Can Past Real Estate Construction Cycles Tell Us About the Outlook For REITs Today?
    Commercial real estate has gone through many boom/bust cycles in the past. These cycles have inevitably affected the performance of REITs through their impact on rents, vacancy rates and property valuations. There are certain features that are common to nearly all these cycles, including overbuilding and a relaxation of risk standards by builders, lenders and investors. There are also differences across these cycles, however, much as Tolstoy wrote in Anna Karenina, “each unhappy family is unhappy in its own way.”
  • In the Middle of a Long Cycle for REITs and Real Estate
    Many analysts and policymakers have pointed to the leveling off in commercial real estate prices and increasing construction to contend that the commercial real estate bull market, which began in 2009, is growing old and nearing its peak. Nareit economist Calvin Schnure disagrees, noting that "economic expansions don't die of old age. They end if they overheat, are overbuilt or overleveraged.” Schnure has done an analysis showing none of these three terminal conditions exists today.
  • REITs: Real Estate With a Return Premium
    A Nareit analysis of the performance of publicly traded equity REITs and private equity core, value-added and opportunistic funds over the last full real estate cycle shows REITs outperformed private equity real estate funds over the entire cycle, as well as over the bull market portion of the cycle when value-added and opportunistic funds’ higher leverage would have been expected to deliver superior returns.