Data Center REITs Continue to Pique Investor Interest, Post Strong Performance Gains

Data center REITs own and manage highly specialized facilities that house the critical IT infrastructure that powers today’s economy. These properties include a variety of features to help keep servers and data safe, including uninterruptable power supplies, air-cooled chillers, and physical security. A wide variety of companies including Amazon, Apple, AT&T, Google, IBM, Meta, Microsoft, Oracle, and others lease REIT-owned data centers.

Data center REITs are viewed as best-in-class operators due to their sector specialization, operational expertise, disciplined balance sheets, and access to cost-effective capital. Their portfolios tend to focus on existing operating cloud and, increasingly, AI inference, data centers which have established durable demand. These factors have attracted increased attention from institutional investors that has resulted in direct joint venture partnerships for new development.

Data from the Nareit REIT Industry Tracker for the first quarter of 2026 (the latest data available) show that data center REITs have continued to deliver strong operational performance. On average, data center REITs experienced year-over-year funds from operations (FFO) and net operating income (NOI) growth rates of 29.4% and 15.8%, respectively. These results underscore that data center REIT operations have more than amply kept pace with inflation.

Weak data center REIT performance (-14.2%) in 2025 presented a buying opportunity for the largest actively managed real estate investment funds focused on REITs. As of the first quarter of 2026 (the latest data available), the Nareit Actively Managed Real Estate Fund Tracker indicated that data centers saw the largest year-over-year gain in assets under management (6.2%), resulting in the largest percentage share of index weight (138%) across sectors. Through mid-year 2026, data centers were among the top-performing REIT sectors (33.2%).

Data center REITs have been active in capital markets. Data center REITs issued $4.2 billion in unsecured debt and $5.3 billion in equity over the past 12 months. This issuance includes two new IPOs focused on the data center space, with additional entrants projected. Data center REITs have also been active in raising capital through joint ventures and other vehicles. Alongside their active capital raising, data center REITs have successfully maintained highly resilient and well-structured balance sheets.

352

According to Nareit’s REITs Across America, REITs in the data center sector of the FTSE Nareit All Equity REITs Index own 352 data center properties.

$1.75 billion

In May 2026, Blackstone Digital Infrastructure Trust (NYSE: BXDC), a blind pool REIT, raised $1.75 billion through an IPO to acquire and own mission-critical data centers.

100%

According to Nareit’s 2026 REIT Industry Sustainability Report, 100% of data center REITs reported procuring clean energy, contributing to grid resources and reliability.