Assessing the state of today’s U.S. economy can be confusing. Focusing on the unexpected shock of the Iran conflict, higher fuel prices, elevated interest rates, and waning consumer confidence may lead to a pessimistic outlook. Yet, concentrating on strengthening economic growth, solid monthly job gains, and limited recession fears may result in a more sanguine viewpoint. These differing perspectives may cause a degree of confusion, but recent data from Nareit’s REIT Industry Tracker clearly show that, on average, REITs have continued to deliver solid operational performance and maintain disciplined, well-structured balance sheets during uncertain times.
The chart above presents quarterly year-over-year NOI and SS NOI growth rates for U.S. public equity REITs from the first quarter of 2025 to the first quarter of 2026. Note that the year-over-year NOI growth rates help account for seasonality in the data, but they do not control for REITs’ transaction activities. Also, while SS NOI is typically viewed as providing a cleaner, apples-to-apples comparison, not all REITs report it. This metric is only available for seven of 13 sectors in Nareit’s REIT Industry Tracker.
As of the first quarter of 2026, REIT year-over-year NOI and SS NOI growth rates were 5.6% and 3.8%, respectively. Notably, both operational performance measures have kept pace with inflation. More than 75% of REITs posted positive year-over-year NOI growth rates; nearly 65% had year-over-year SS NOI gains. Continued solid operational performance in an uncertain economy is a testament to REITs’ asset selection and management expertise.
REITs Maintain Well-Structured Balance Sheets
The chart above displays REIT balance sheet metrics from Nareit’s REIT Industry Tracker for the fourth quarter of 2021 and the first quarter of 2026. The data from the fourth quarter of 2021 showcases the state of REIT balance sheets prior to the surge in the 10-year Treasury yield in 2022. Since then, interest rates have remained elevated.
Across both points in time, REITs have proven to be excellent stewards of their balance sheets. REITs, on average, have maintained low levels of leverage. Their emphasis on fixed rate debt and longer terms to maturity have limited their exposure to higher interest rates. Access to unsecured debt has proven to be a competitive advantage. Low debt costs have also afforded REITs considerable operational flexibility to address property and firm needs.
Although the current state of the U.S. economy can be characterized by a degree of confusion, REITs have shown operational and managerial resilience during uncertain times. They have reliably and dependably continued to deliver solid operational performance to their investors. REITs have also maintained disciplined and well-structured balance sheets which are expected to prove beneficial as future growth opportunities emerge.