T
he listed real estate market is poised for a new upcycle, with CBRE Investment Management predicting accelerated earnings growth and robust total returns in 2025. This optimism stems from the recognition of a pause in rate hikes, which has created a favorable environment for listed real estate to thrive. Historically, periods of range-bound long-term yields have been beneficial for this sector, as evidenced by its double-digit average returns during the 2001-2007 period when US 10-year bonds yielded between 4% and 5%.

    As the investment firm notes, strong access to capital is a key differentiator for listed real estate compared to private markets. This advantage can be maintained moving forward, enabling listed real estate participants to capitalize on opportunities and deliver compelling total returns. With earnings growth expected to accelerate across various sectors in 2025, including senior housing, data centers, cell towers, and retail, the stage is set for a strong performance.

    The dividend yield of ~4% remains competitive with private real estate income, and the conservative payout level ensures that this income stream continues to grow. Amidst moderating central bank target rates and range-bound long-term yields, listed real estate is well-positioned to prosper in 2025, offering a compelling total return opportunity for investors.