The commercial real estate industry is heading toward pandemic recovery, according to data provided by the National Association of Real Estate Investment Trusts (Nareit).
Second quarter REIT earnings recovery was broad-based, with approximately two-thirds of all REITs reporting higher funds from operations (FFO) than one year ago. FFO rose 19.8% over the prior quarter, to $16.5 billion, which is slightly above peak level prior to the pandemic, according to Nareit.
Second quarter net operating income (NOI) is above last year’s figures as well. NOI totaled $25.6 billion, which was 7.5% higher than the first quarter of 2021 and 22.2% above the same period last year.
“REIT earnings have fully recovered the declines that occurred early in the pandemic, and FFO of the overall REIT sector stands slightly above the peak level prior to the pandemic,” Calvin Schnure, Nareit senior economist, stated. “REITs and commercial real estate are experiencing a more complete recovery as the economic reopening continues.”
