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Top office REITs see rental pricing power as leasing tightens
Only 19.7 million square feet of office space is under construction nationwide, leaving limited new supply for landlords competing for top buildings.
Office REITs have faced a long-running bear case tied to remote work and falling valuations, but new leasing data points to improving fundamentals, MarketBeat Ratings reports.
The outlet says AI-driven demand is increasingly benefiting data-center REITs such as Equinix and Digital Realty, while office REITs may still be positioned differently because leasing demand for top buildings is holding up as AI firms and employers compete for premium space.
According to MarketBeat Ratings, limited pipeline is a key factor, with just 19.7 million square feet of office space under construction nationwide, supporting pricing power for owners of the best properties.
Manhattan is highlighted as leading the rebound, with office visits up 6% year over year as startups, AI companies, and large employers pursue trophy towers.