SRS - What We're Watching This REIT Earnings Season
2025-02-05 09:00:00 ET
Summary
- Real estate earnings season kicks into gear this week, and over the next month, we'll hear results from 175 equity REITs, 40 mortgage REITs, and dozens of housing industry companies.
- Following a year-end tumble that lingered into early 2025, REITs enter earnings season with a bit of upside momentum as Treasury Yields eased from the cusp of two-decade highs.
- Largely immune from trade/tariff and AI-related risk, REITs are coming back into favor after three years of historic underperformance, which has driven valuations to unusually "cheap" levels.
- Notable favorable "green shoots" gleaned from recent data: 1) Surprisingly strong office leasing; 2) Accelerating hotel demand despite recent incidents; 3) Post-election recovery in logistics demand; 4) Robust apartment demand.
- Weaker trends include: 1) Abrupt cooling in retail demand amid a jump in store closings; 2) Sluggish single-family rent growth; 3) Very weak self-storage trends; 4) Uncertainty on the "Deep Seek" impact on data centers.
Real Estate Earnings Preview
Real estate earnings season kicks into gear this week, and over the next month, we'll hear results from more than 175 equity REITs, 40 mortgage REITs, and dozens of housing industry companies which will provide key insights into how the real estate industry is adapting to the shifting interest rate regime. Since we last heard from these REITs in November, notable incremental favorable trends gleaned from recent industry data and commentary over the last three months include: 1) surprisingly strong office leasing; 2) accelerating hotel demand despite recent incidents; 3) post-election recovery in logistics demand. Weaker trends include: 1) a rather abrupt cooling in retail demand amid a jump in store closings; 2) still-sluggish residential rent growth; 3) very weak self-storage trends; 4) uncertainty on the "Deep Seek" impact to data centers. Below, we compiled the earnings calendar for equity REITs and homebuilders....
What We're Watching This REIT Earnings Season