The State Of REITs: July 2025 Edition

2025-07-18 16:29:13 ET

REIT Performance

In June, REITs continued to recover with a +2.56% average total return. However, the REIT sector again lagged the gains of the broader market with stronger performances from the NASDAQ (+6.6%), S&P 500 (+5.1%) and Dow Jones Industrial Average (+4.5%). The market cap weighted Vanguard Real Estate ETF ( VNQ ) underperformed the average REIT again in June (+0.69% vs. +2.56%), but has significantly outperformed year-to-date (+2.01% vs. -5.65%). The spread between the 2025 FFO multiples of large cap REITs (17.6x) and small cap REITs (13.3x) narrowed in June as multiples contracted 0.2 turns for large caps but expanded 0.4 turns for small caps. Investors currently need to pay an average of 32.3% more for each dollar of FFO from large cap REITs relative to small cap REITs. In this monthly publication, I will provide REIT data on numerous metrics to help readers identify which property types and individual securities currently offer the best opportunities to achieve their investment goals....

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