Patrick Wilson, portfolio manager on the real estate securities team at CenterSquare Investment Management, told the REIT Report that reasonable demand, pockets of strength, and very low supply on the horizon should amount to “pretty healthy” earnings growth for REITs in the next 12-24 months.
The combination of higher interest rates suppressing development for most property sectors with the exception of data centers, alongside solid balance sheets, creates “a really good scenario and outlook for REITs today,” Wilson said. “I really do think we're in an attractive point in the cycle right now for listed real estate.”
In many ways the current K-shaped economy is playing out in favor of the REITs that cater to higher-end consumers versus the broader commercial real estate market as a whole, Wilson noted. He also pointed to increased M&A activity as evidence that scale, balance sheet strength, and access to lower-cost capital are becoming more important in a higher-rate environment.
Content: 00:00 Why REITs Look Attractive 00:35 Welcome and Guest Intro 01:02 Macro Outlook Next 24 Months 05:35 M&A Surge Explained 07:50 Will Deals Keep Coming 08:50 Top Sector Picks Now 12:54 Data Center Moratorium Risks 16:42 Life Sciences and AI Rebound 24:23 Closing Takeaways
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