Even with record new supply, renters are paying a premium for modern design, smart amenities, and...
Following strong Q3 results, REITs enter 2026 with high occupancy, steady income growth, and well-managed debt — but portfolio visibility will matter more than ever.
REITs show strength amid market uncertainty
U.S. REITs posted another strong quarter in Q3 2025, continuing a trend of operational resilience despite a still-shifting economic backdrop.
According to the latest data, Funds From Operations (FFO) rose 17.3% year-over-year, reaching $21B. Nearly two-thirds of REITs saw FFO gains — a notable reversal from the tougher 2024 environment.
Net Operating Income (NOI) also strengthened, climbing 5.2% YoY to $30.6B. Same-store NOI grew 2.8%, underscoring steady internal performance across multiple property types.
Nareit’s EVP of Research, John Worth, summarized it well:
“These strong results show that REITs are ready to take advantage of new growth opportunities in 2026.”
Occupancy remains elevated across most sectors
Average REIT occupancy landed at 93%, with retail leading the way at an impressive 96.9%. Apartments followed at 95.7%, and industrial posted 94.5%.
Office remained the exception at 85.3%, confirming ongoing demand challenges — though still stable relative to recent years.
High occupancy continues to provide a reliable foundation for portfolio income entering 2026.
Debt is disciplined, long-term, and mostly fixed
REIT balance sheets remained conservative in Q3:
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80.6% unsecured debt
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88.7% fixed-rate
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Average maturity: 6.2 years
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Leverage ratio: 32.9%
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Average interest rate: 4.1%
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This structure shields REITs from short-term rate fluctuations — a key advantage during periods of market recalibration.
Selective growth continues
REITs recorded $4.7B in net acquisitions during Q3. While not aggressive, this reflects ongoing commitment to strategic, targeted growth rather than broad expansion.
Nareit’s T-Tracker® confirms the trend: the sector remains fundamentally stable and well-positioned for the next cycle.
What this means for 2026
Strong income. High occupancy. Well-managed debt.
These are the building blocks of resilience — but the next year will still require:
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Better visibility into NOI drivers
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Scenario-based reforecasting
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Clear tracking of maturity schedules
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Portfolio-wide reporting clarity
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In other words: stability doesn’t mean “set it and forget it.”
It means it’s time to sharpen execution.
How Kardin helps REIT teams stay ahead
Kardin gives REIT owners, operators, and asset managers tools to:
✔ Build rolling reforecasts
✔ Track NOI and occupancy trends at the property and portfolio level
✔ Manage debt assumptions and maturity timing
✔ Produce investor-ready reporting without spreadsheet sprawl
As REITs enter a potentially opportunistic 2026, clarity and discipline will matter more than ever.
👉 Learn how Kardin helps REIT teams translate complexity into insight:
