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REIT Earnings Recovery Slows to 2% Growth in Q1

After two consecutive quarters of double-digit growth, REIT earnings recovery slowed in the first quarter of 2021, Nareit reported. The Q1 Nareit Total REIT Industry Tracker Series (T-Tracker) report showed funds from operations for all equity REITS rose 2.0% to $14 billion.

“Different parts of the economy are reopening at different speeds, and REIT performance by property sector reflects this variation,” said Calvin Schnure, Nareit senior economist. “The recovery is broadening with the vaccine rollout, however, and prospects for improvement have gone from ‘if’ to ‘when’.”

Q1 REIT earnings performance varied significantly by sector. FFO for REITs propelled by the digital economy, including those in the data center and industrial sectors, hit record highs during the quarter. 

Residential REITs rose 5.5% after declining in three of 2020’s quarters. Conversely, office REITs saw negative growth in Q1, while lodging REITs withstood their fourth consecutive quarter of declining FFO.

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About Paul Bubny

Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 13-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types, as well as delving into broader subject matter. He produces 15-20 daily news stories per day and works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces. Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and GlobeSt.com at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications. Since 1999, Paul has volunteered as the newsletter editor of passenger rail advocacy groups (one national, one local).

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