The U.S. 10-year Treasury yield rose roughly 85 basis points during the third quarter, and listed real estate reacted quickly — cap rates across all U.S. REITs increased about 40 basis points, implying values lower by roughly 7%. But the impact wasn’t uniform: with the REIT sector overall less than 30% levered and about 90% fixed-rate, the earnings impact from the rate move was below 1%. Office, with slightly higher leverage, felt it most; data centers and healthcare, buoyed by lower leverage and stronger structural demand, felt it least.
Our Q3 2026 REIT Cap Rate Perspective Report offers an analysis of why REITs are increasingly operating-intensive businesses rather than bond proxies, and what sector-level divergence in rate sensitivity means for capital deployment ahead.
