Reasons to Consider Buying REITs

There are three key reasons why investors should consider purchasing Real Estate Investment Trusts (REITs) today. First, attractive fundamentals such as positive same-store net operating income (NOI) growth and strong occupancy rates indicate a solid foundation for these equity REITs. Second, cash flow growth for REITs historically remains relatively strong, with projected growth rates of 3.2% to 3.5% in 2023 and 2024. Lastly, REITs have historically performed well in recessionary environments, delivering returns of over 10% in the US and 14% in Europe, making early cycles and the end of a REIT cycle favourable entry points. Despite elevated interest rates, keeping an eye on earnings and quality management can help identify REITs with potential for future growth and dividend increases.