Industrial – Back To The DC Future
2023 saw industrial REITs once again shine as their prior outperformance returned and
private market demand for quality industrial properties remained relatively strong. While the
positive tailwinds of exceptionally high lease renewal spreads, very tight leasing markets, and
rapidly accelerating new construction costs have continued unabated, the back-up in interest
rates has caused a modest reset in unit values, owing to the generally lower implied cap
rates of the sub-sector, bringing them generally back to levels last seen pre-pandemic.
Recent M&A activity in the space and a wall of capital sitting on the sidelines may keep the
industrial REITs in the forefront in 2024. Our favoured way to gain exposure to the industrial
REITs is Dream Industrial REIT.