REITs deliver investment performance, diversification, liquidity, reliable dividends and inflation protection.
Let’s explore some of the evidence assembled by Global REIT Alliance members.
Long-term investment performance
Globally, equity REITs outperform private real estate, stocks and bonds over the long-term.
Source: Nareit
REITs easily outshine rival asset classes when we look at compound annual growth rates.
Turning to Europe, the listed REITs and real estate companies category scored an annualised 7.4% return over 20 years, much higher than European equities and bonds.
Source: EPRA
Source: EPRA
The five-year average yield of listed real estate in the FTSE EPRA NAREIT Developed Europe REITs Index is 4.7% (as of June 30, 2021), decisively surpassing the competition.
REITs and society
In Europe, REITs generate €32.8 of tax revenue for every €100 of turnover.
These two EPRA reports showcase three big themes:
First, REITs strengthen financial markets, boost stability and increase liquidity, especially in economic downturns.
Second, REITs generate significant tax revenue that benefits society by supporting public services and infrastructure, countering misconceptions about low tax contributions.
Third, REITs drive urban development, promote sustainability, and address housing shortages.
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Total Tax Contribution of Real Estate Investment Trusts in Europe (2020)
The Impact of European REITs - the role of real estate investment trusts in the European economy (2023)
The 2024 EPRA-INREV report highlights the commercial real estate sector’s critical role in Europe’s economy:
Economic Impact: €523 billion contribution (2.9% of EU GVA), surpassing automotive and telecom industries.
Employment: 4.4 million direct jobs.
Investment: €374 billion annually in development and refurbishment.
Sustainability: Institutional investors manage 70% of commercial real estate, driving ESG initiatives (37% of end-user emissions).
Housing Growth: Institutional housing investments quadrupled since 2013 to €573 billion.
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