Everyone loves a bargain. With the current Black Friday sales season in full swing, consumers are awash with opportunities to stretch their holiday shopping dollars. Investors also appreciate good values. Today, REITs have maintained average occupancy rates akin to or higher than their private real estate counterparts across the four traditional property types. They have also remained attractively priced compared to private real estate. For investors that appreciate good value in the real estate space, REITs may be an appealing investment proposition.
The chart above displays a scatter plot of public and private real estate capitalization (cap) rates and occupancy rates for the four traditional property types—apartments, industrial, office, and retail—as of the third quarter of 2025. Data from Nareit’s quarterly REIT Industry Tracker and NCREIF are used for the public and private real estate measures, respectively. The NCREIF data solely focus on properties from Open End Diversified Core Equity (ODCE) funds. The REIT industrial metrics exclude cold storage operators.
REIT occupancy rates were greater than their respective ODCE occupancy rates across each of the property types except industrial. Retail and office had the largest differentials at 4.7% and 4.5%, respectively. The apartment occupancy rate difference was 1.4%. The industrial gap was modestly negative at -0.1%, but both measures posted notably high occupancy rates exceeding 95%. High and higher REIT occupancy rates may simply be a function of greater operational focus. They may also be related to better asset management and/or property selection.
For each property type, the REIT implied cap rate exceeded its respective ODCE appraisal cap rate. In the third quarter of 2025, the public-private cap rate spreads were 191, 121, 94, and 79 basis points for the apartment, office, industrial, and retail sectors, respectively. All else equal, these spreads suggest that REITs offer more attractive pricing relative to private real estate across each of the examined property types. Pricing in some sectors like apartments remains particularly compelling.
REITs provide investors with access to well-located, high-quality, institutional-grade properties managed by best-in-class operators. Across the four traditional property types, U.S. public equity REITs have enjoyed occupancy rates akin to or higher than their private real estate counterparts. REITs have also continued to maintain a pricing advantage. The combination of these factors presents a compelling buying opportunity for real estate investors that appreciate good value.