Harsh Hemnani, senior debt research analyst at Green Street, joined the REIT Report podcast to review current trends across the commercial and residential mortgage REIT (mREIT) sector.

Hemnani discussed the size and breakdown of the mREIT market, the current operating environment, macroeconomic forces impacting performance, valuation and total returns for MREITs, risk profiles, and the outlook for the sector over the next 12 to 24 months.

Commercial mREITs are able to underwrite idiosyncratic, property-level risk, Hemnani said. Not only can they execute the loan quicker than other lenders, but they also provide certainty as to who the loan counterparty will be throughout the life of the loan. “mREITs take out that uncertainty and that’s the value proposition they provide to the commercial real estate market,” he noted.

Hemnani described the backdrop for commercial mREITs today as encouraging. “If you think about commercial real estate credit, it's fairly attractive on a risk adjusted basis. Property values have declined roughly 20% from their peak and they seem to have stabilized. So the risk of a broad-based property value decline from there is fairly low.”

Breana Wheeler, director of U.S. operations at BREEAM, joined the REIT Report to discuss the evolving landscape of sustainability in real estate, including how investor expectations are shifting to performance-based frameworks that emphasize data and measurable outcomes.

BREEAM is a Nareit Real Estate Sustainability Partner for 2026.

Wheeler noted that capital providers and investors “are really looking for the data and performance that can validate the claims being made about sustainability risk and opportunity.” BREEAM’s focus on carbon emissions and resilience metrics is highlighted as a critical factor in asset valuation and risk management, particularly in light of increasing regulations and climate risks. 

Wheeler emphasized that resilience isn't about a single building. “True resilience is a team sport. It's not just thinking about your asset, it's about your block, your neighborhood, and your broader community. The willingness to tackle physical risk and mitigate at the community level is critical,” she said.

Gina Szymanski, chief investment officer at AEW Capital Management’s global securities business, joined the latest episode of the REIT Report to share her insights into the year ahead. She noted that REITs are facing a favorable macroeconomic backdrop marked by good demand, moderating supply, and stable interest rates.

“The setup for us is great. and I would highly recommend the average investor take a look at REITs,” Szymanski said. “We're experiencing some of the best growth that we've ever experienced,” she added.

For the most part, the sectors that AEW has been overweight in are still favorites, Szymanski said. Number one on that list is senior housing, where AEW has been overweight across the globe. Data centers are in second place, followed by retail. Industrial remains “on the margin,” she added.

Melinda McLaughlin, global head of research at Prologis, Inc. (NYSE: PLD), joined the REIT Report to review major supply chain trends expected for 2026. 

McLaughlin discussed the performance of international logistics markets, the impact of e-commerce on leasing demand, the growing power needs of logistics facilities, emerging trends in defense-related demand, and the challenges faced by the trucking industry. 

The conversation highlighted the need for adaptability in supply chains as companies navigate a changing landscape. “I think there's an acknowledgement that supply chains need to be adaptable rather than continue to wait for perfect information. And I think that's really going to shape a return to normal in a lot of different spheres of the logistics real estate market,” McLaughlin said.

Nareit’s Senior Vice President for Research Ed Pierzak and Nareit Vice President for Index Management and Industry Information John Barwick joined the REIT Report to highlight key themes and trends in Nareit’s 2026  REIT Outlook.

Pierzak discussed the dual divergences at play between REITs and broader equities and REITs and private real estate. Each provides an opportunity for REITs to outperform, he said. At the same time, REIT balance sheets point to access to capital, putting the sector in a “great position to really embark on a growth opportunity in 2026,” alongside signs of a thawing in the transaction market, Pierzak said.

Meanwhile, Barwick discussed global REIT performance, noting that currency movements were a significant tailwind for U.S.-based investors in 2025 as a weaker dollar bolstered the performance of international assets. For U.S. investors, strong local returns in developed Asia and developed Europe were further boosted when translated back into dollars, which widened the performance gap with North America, Barwick noted.

Read the 2026 REIT outlook: https://www.reit.com/news/blog/market-commentary/2026-reit-outlook-trends-and-strategies

Ronald Kamdem, head of U.S. REITs and commercial real estate research at Morgan Stanley, joined the REIT Report podcast to discuss current performance in the office REIT sector and how it is positioned for 2026.

Kamdem spoke about the recovery of the office market post-pandemic, highlighting regional variations, trends in leasing and utilization, the impact of new developments, and the future of class B assets. Current sentiment in the REIT space, and how valuations are influencing strategies moving forward, were also discussed.

“There's a lot of excitement in the office market right now because there's certainly been a lot of leasing that's been done in 2025…for the first time from a financial perspective, you're in a position where in 2026 going into 2027, you're going to be able to post some sort of financial and earnings growth to the market that people want to see,” Kamdem said. He added that if interest rates continue to trend lower, that will provide an additional tailwind to earnings growth.

Andrew Alperstein, real estate partner at PwC, joined the REIT Report to share findings from the Emerging Trends in Real Estate 2026 outlook, produced with the Urban Land Institute. A major trend highlighted in the outlook is the shift away from a sector-based investment focus to one that drills down to the asset and submarket level.

Alperstein explained that value creation in the real estate sector has reflected financing and lower cap rates. Going forward, “what we expect is that a lot more value creation will need to come through property operations, really driving revenue growth or rental growth, really being focused on expenses and capital spend, and less so on the capital markets in the coming years.”

Alperstein described investor sentiment as slightly muted compared to recent years, reflecting uncertainty related to interest rates, valuations, transaction activity, and policy.

Jeff Edison, chairman and CEO of Phillips Edison & Co., Inc. (Nasdaq: PECO), joined the REIT Report to celebrate 65 years of REITs. He noted how the REIT structure has allowed PECO to efficiently raise capital in both the retail and institutional markets, enabling it to pursue aggressive growth and become one of the largest owners and operators of grocery-anchored shopping centers today.

PECO was founded in 1991 and operated as a public non-listed REIT before its IPO in 2021.

Edison noted that the REIT structure has made investing in real estate accessible to everyone. “PECO's investors can own the best necessity-based grocery and shopping centers across growing suburbs in the market... and our retail investors can invest alongside some of the biggest institutional investors in the world,” Edison said. Today, retail investors own about 25% of the REIT’s common shares, which is much higher than its peer average, he added.

Mike Acton, head of research and strategy for North America at global real estate asset manager AEW, joined the latest episode of the REIT Report. He discussed why commercial real estate provides an anchor amid today’s tech-driven market boom, how many smaller and retail investors are under-allocated to the sector, and why now could be the best entry point in a decade for real estate investment.

Acton noted that the largest, most sophisticated institutional investors typically have real estate allocations that are anywhere from 10% to 15% of their portfolio. Within that real estate allocation, 10% to 20% might be in the listed space.

“There's a lot of evidence that the leading investors are doing something very different than what a lot of smaller investors, certainly what a lot of retail investors, are not doing and probably should be,” Acton said.

Darren Richman, CEO of Millrose Properties, Inc. (NYSE: MRP), joined the REIT Report podcast to discuss the land banking business model and how the REIT works with major home builders to improve capital efficiency.

Millrose was spun off from home builder Lennar Corp. in February, allowing Lennar to focus on the consumer-facing aspect of its business by transferring the land development side to Millrose. The REIT works with Lennar and 11 other homebuilders.

“The more modern form of land banking is about capital efficiency, where a builder is looking to clarify their own business model, looking to separate the opco (operating company) from the propco (property company),” he said.