Stephan Richford, managing director at BMO, sat down for a video interview during Nareit’s REITworld: 2025 Annual Conference in Dallas on December 8–11.
Richford expressed optimism about the REIT sector’s trajectory, noting that the fall of 2024 offered a clear sign of resilience.
“When 10-year Treasuries were [close to] 4%, we saw a really nice run of follow-on equity,” he said, adding that the activity was broad, spanning office, mall, health care, and net lease REITs. That moment signaled that valuations had reached a level where management teams and boards “could think about growing again,” he said.
Richford emphasized that REIT balance sheets remain strong. “Spreads are at all-time tights in most cases,” he noted, suggesting free cash flow should continue to grow as a harbinger of positive things for the REIT sector. At the same time, persistent NAV discounts are limiting accretive capital raising, prompting companies to rely more heavily on buybacks, PIPEs, JVs, and asset recycling. In today’s market, recycling “tends to be the cheapest and best source of equity capital,” Richford said.
Looking to 2026, he highlighted expectations for multiple Fed rate cuts, though he cautioned that treasury yields may not move in parallel. He also pointed to rising private equity activity and a strong appetite for real estate assets among institutional investors, particularly in emerging sectors such as self-storage and manufactured housing.