US REITs are outperforming broader equity markets in 2026, fueled by strong occupancy, increased buybacks, and a decoupling from interest rate volatility.
US REITs returned 16.7% through August with occupancy at 93.8%, rising buybacks, and $58B in M&A, supporting Hazelview's constructive view.
Global REITs returned 9.8% through August, lagging the US but reflecting a broader recovery in property fundamentals.
The S&P 500 gained 13.1% through August, underperforming US REITs but remaining positive.
The MSCI World Index returned 13.4% through August, slightly ahead of the S&P 500 but behind US REITs.
US REITs have surged 16.7% through August 2026, outpacing the S&P 500 and MSCI World Index. Hazelview Investments attributes this performance to resilient 93.8% occupancy rates, declining supply pipelines, and robust M&A activity totaling $58B. The sector is showing reduced sensitivity to Treasury yields, suggesting that property fundamentals are now the primary driver of valuation.
Hazelview Investments notes that the historical correlation between bond yields and REIT returns has weakened. Investors are increasingly focusing on strong property fundamentals, such as high occupancy rates and limited new supply, rather than interest rate sensitivity alone.