Hazelview Investments flags global REITs trading at multi-decade lows just as fundamentals tighten
Global REITs are trading at multi-decade valuation lows relative to broader equities just as fundamentals strengthen, setting up what Hazelview Investments frames as a potential inflection point for listed real estate in 2026, according to its 2026 Global Public Real Estate Outlook Report.
According to Hazelview, global REITs have underperformed global equities since 2020, reflecting the disproportionate hit from the pandemic and subsequent monetary tightening.
In the US, REITs have seen the largest valuation decline of any major equity segment since 2021.
The firm argues this “atypical” stretch may be nearing a turning point as fundamentals, valuations, and capital discipline begin to realign.
As per the report, global REITs now trade at multi-decade lows versus broader equities and at a double-digit discount to intrinsic value.
Hazelview notes that companies are responding to this disconnect through share repurchases and privatization activity as public market valuations remain persistently below private market asset values.
On the fundamental side, Hazelview highlights a favourable global supply-demand backdrop across key property types.
New supply as a share of existing stock for retail, industrial, residential, and office is forecast to decline materially in most developed markets, potentially reaching all-time lows in regions such as the US, Europe, Canada, Australia, and parts of Asia-Pacific, according to the report.
At the same time, occupancy is trending above historical averages across major property types, supporting pricing power and expectations for stronger rent growth.
For 2025, Hazelview describes a volatile macro environment marked by trade uncertainty and shifting monetary policy.
As trade headwinds eased and financial conditions improved across major economies, global REITs finished the year with a high single-digit return in local currency terms.
Regionally, Japan, Hong Kong, and Singapore led performance, with Canada and the UK also outperforming the global benchmark, while continental Europe lagged and the US delivered the weakest results among major regions.
By sector, healthcare outperformed on the back of senior housing fundamentals, while cold storage, life science, data centres, and residential REITs underperformed.
Looking ahead to where it sees potential outperformance in 2026, Hazelview’s “best ideas” focus on segments tied to structural demand and constrained supply.
According to the report, industrial real estate in North America, Europe, and Japan benefits from lower new supply and stronger leasing dynamics.
Senior housing in North America is supported by favourable demographics and limited new construction.
Data centres stand out on continued demand linked to AI adoption, with particular emphasis on opportunities in the US, Hong Kong, and Singapore.
Residential markets in Australia and Germany are expected to see strong rental growth as supply-demand imbalances persist.
Overall, Hazelview presents global listed real estate as an “interconnected mosaic” where tightening supply, resilient demand, and discounted valuations could allow REITs to start making up lost ground in 2026 and beyond, according to its outlook.
