REITs offer compelling investment opportunity compared to private real estate

With the fundamental shifts occurring in the office industry, investors are wary of investing in the office sector, but office REITs may offer a compelling opportunity, given the way public real estate valuations have repriced ahead of private real estate. In addition, office REITs stand to benefit from a number of market trends.

“One of the most fundamental shifts occurring in the office industry is the bifurcation between the ‘haves’ and ‘have-nots’,” explained Uma Moriarity, senior investment strategist and global ESG lead at CenterSquare Investment Management, in a recent interview with IREI. “The best office assets — by quality and location — are gaining market share at the expense of the lower-quality, commodity office spaces that are more-or-less obsolete. The benefit of the office REITs is that they effectively exclusively own the top-tier quality of assets that are gaining market share.”

The other differentiator for office REITs is their co