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
