Stacey McEvoy, partner at Hogan Lovells, was a guest on the latest episode of the REIT Report podcast. She discussed REIT transaction activity, capital raising, legal and regulatory issues facing the industry, and more.
McEvoy noted that REITs demonstrated resilience in the first half of 2025 and pointed out that those REITs that have maintained disciplined balance sheets have been the most successful at navigating market volatility.
“I do think the modest positive performance that REITs have experienced during these uncertain times have left them well-positioned to achieve stronger performance in 2026 as the markets stabilize,” she said.
McEvoy also said the market is continuing to feel the effects of the high cost of capital from the last couple of years, along with higher cap rates. “And although those have been declining, investor sentiment remains cautious. As a result, transaction volume has been down.”
While the lack of M&A deal activity points to continuing valuation gaps and ongoing strategic caution, capital raising could be a positive sign that REITs are positioning for growth opportunities ahead, McEvoy noted.
As for legal and regulatory issues, McEvoy highlighted the need for REITs to “continually assess” their culture and values and how these matters are navigated. She also pointed to changes in tax policies and how they impact foreign investors, as well as risk management issues for REITs.