The state of the capital markets, macroeconomic trends, and the outlook for the REIT sector amid a complex and uncertain environment were topics of discussion during the lunch general session on day one of Nareit’s REITweek: 2026 Investor Conference.
Sumit Roy, president and CEO of Realty Income Corp. (NYSE: O) and Nareit 2026 Chair, moderated the panel which included: Seth Carpenter, chief global economist at Morgan Stanley, Joseph Lupton, co-head of economic research at JP Morgan, and Andy Richard, co-head of global real estate banking, gaming and lodging, investment banking at Citigroup Global Markets Inc.
Lupton told the session that the inflation backdrop is “worrying,” with the next move on interest rates likely to be up rather than down. “You can't get a big cyclical lift in a world where supply is kind of lagging this cyclical demand increase. And so that means inflation pressures,” he pointed out.
Richard, meanwhile, noted that REITs are outperforming this year, with the sector showing accelerating growth, mostly positive key performance indicators, limited new supply, and cap rates that are largely stabilized. Overall it’s a stable macro environment for REITs, he said, while capital is available for “good growth stories.”
He added, “We've had IPOs this year. We've had very strong follow-ons. People are using their ATMs. The equity market's there for growth and there is also recognition that REITs will be an important part of the AI buildout.”
As to which REIT sectors are poised to perform well, despite geopolitical uncertainty, panelists highlighted the senior housing sector, given its aging population tailwinds.
Other observations during the session included:
- It’s “critical” for all REITs to be very thoughtful about presenting a differentiated story about how to access capital and deploy that capital positively for shareholders, Richard said.
- The planned merger between AvalonBay Communities, Inc. (NYSE: AVB) and Equity Residential (NYSE: EQR) is positive for the REIT industry because, in a world of trillion dollar companies such as NVIDIA, increased REIT scale will help attract attention from investors, Richard said.
- In terms of breadth, depth, and underlying momentum, U.S. real estate markets outpace other regions of the world, Carpenter said. “It's just hard to get excited about Europe. U.S. sentiment is doing much better,” Lupton added.
- One thing the market is underestimating is the positive impact low supply is going to have on real estate fundamentals for the next two, three, or four years, according to Richard. For his part, Carpenter noted that energy shock risks are being underestimated. Lupton, meanwhile, added that inventory rebuilding in the second half of the year is another factor that has been underestimated.