Nareit commissioned EY to estimate the current economic contribution of all U.S. REITs (including public listed, public non-listed, and private REITs) in the United States.
- The total economic contribution of U.S. REITs in 2018, the most recent year of complete information, was an estimated 2.4 million full-time equivalent (FTE) jobs and $148.2 billion of labor income. The total economic contribution, or “footprint,” of REITs consists of the direct operations of REITs and related businesses in the United States, as well as the impacts from dividend and interest payments by REITs and REIT property improvement and construction investments. The U.S. economic contribution of REITs extends beyond the direct operations of REITs and includes the indirect contributions of their suppliers and the induced contributions of businesses supported by the spending of REIT employees, bondholders and shareholders.
The figure below summarizes the direct, indirect and induced REIT contributions to U.S. employment activity.
- REIT operations supported 955,000 FTE jobs and $60.2 billion in labor income.
- Capital expenditures and new construction supported 879,000 FTE jobs and $57.0 billion in labor income.
- Dividends distributed and interest payments to investors supported 521,000 jobs and $31.0 billion in labor income.
Some key results related to REIT economic contributions in 2018 include:
- REITs directly employed an estimated 276 thousand FTE employees who earned $15.2 billion of labor income in the United States. REIT supplier purchases and spending by REIT employees supported an additional 679,000 FTE jobs and $45.1 billion of earnings in the United States. In total, the economic footprint of U.S. REIT operations comprised 955,000 FTE jobs and $60.2 billion in labor income.
- REIT activities also resulted in the payment of an estimated $60.9 billion of interest income and the distribution of $128.9 billion of dividend income by REITs. This interest and dividend income supported 521,000 FTE jobs earning $31.0 billion of labor income through the induced contribution of re-spending by REIT bondholders and shareholders. Of these, $78.4 billion of interest and dividends was paid by REITs to the retirement accounts of U.S. residents, where it is available for future consumption spending.
- REITs invested $59.4 billion in new construction and routine capital expenditures to maintain existing property. The related construction activity supported 415,000 FTE construction jobs that earned $26.7 billion in labor income. Purchases of goods from suppliers and consumer spending by construction and supplier employees contributed an estimated 464,000 FTE jobs and $30.3 billion in labor income.
- REITs paid over $19 billion in property taxes in 2018. This does not include the additional property tax supported by REITs through their indirect and induced economic contribution.