Michael Knott, head of U.S. REIT research at Green Street, sat down for a video interview at Nareit’s REITwise: 2026 Educational Conference in Hollywood, Florida, March 24-26.
Knott discussed how today’s REIT landscape is fundamentally different from prior cycles, driven by three forces: structurally higher interest rates, the uncertain impact of AI on employment, and a more concentrated, top-heavy industry. After decades of falling rates acting as a “tailwind,” investors now face a tougher environment where that support may not return. As Knott put it, “low rates…were almost like a drug…now it looks like we’re not going to have access to that.”
AI introduces a longer-term risk: a potential disconnect between GDP growth and employment, which could weaken demand for sectors like office real estate. Meanwhile, the largest REITs are increasingly partnering with private capital, signaling limits to public equity funding but also validating their scale and expertise.
For investors, Knott emphasized long-term discipline over rate forecasting. He recommends “getting uncomfortable” by buying deeply discounted sectors like single-family rentals, while still leaning into strong themes like data centers and resilient retail. Valuations overall appear near equilibrium, he said, with capital flows stabilizing, debt markets healthy, and transaction activity rebounding.
Looking ahead, M&A and activism are accelerating, creating opportunities—but also “binary risk” that is difficult to manage—suggesting investors should prioritize risk management over trying to predict deal outcomes.