Real estate

Renewed potential for real estate investors in 2026

January 18, 2026
Bhavik Desai
Product Director
A corridor between rows of illuminated server racks in a data center

As 2026 begins, listed real estate offers a compelling combination of improving fundamentals, attractive valuations, and sector-specific opportunities. A supportive macro backdrop, restrained development pipelines, and accelerating growth expectations provide a favorable setting for active managers seeking to capitalize on valuation gaps and structural themes. While dispersion across property types remains, the overall outlook for REITs is constructive, with potential for both income and capital appreciation as markets normalize.

Key takeaways for 2026

Constructive macro backdrop

Economic resilience and easing financial conditions are creating a supportive environment for real estate investment trusts (REITs) in 2026.

Attractive valuations

Trading at a discount to stocks, REITs offer a potential buying opportunity because of narrow valuation gaps that have historically occurred during recovery cycles.

Sector opportunities

Data centers, residential, and self storage offer strong structural tailwinds, in our view, and are trading at discounts. Health care shows a premium due to demographic demand. Office remains challenged.

Growth outlook

Forecasts point to above-average funds from operations (FFO) growth of about 6.5% in 2026.1

Read the complete report: 2026 brings renewed potential for real estate investors.

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    Source: Invesco estimates based on Bloomberg L.P. and Factset consensus data and the FTSE Nareit All Equity REITs Index, data as of Oct. 2025.

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