After several years of significant underperformance, UK Real Estate Investment Trusts (REITs) may finally be approaching an inflection point. In this latest episode of Hardman Talks, Larissa Adams is joined by Mike Foster, Property Analyst at Hardman & Co, to examine whether recent macroeconomic shifts and improving fundamentals signal a renewed investment case for UK commercial real estate. The discussion explores what’s changed in both valuation metrics and the broader market environment.
Mike outlines a range of compelling factors now working in favour of UK REITs. Chief among them is the shift in global monetary policy – particularly in the United States – where recent political and economic developments have triggered a flight from treasuries to real assets, including gold and property. As quantitative tightening comes to an end and long-term bond yields face increasing political pressure, UK REITs stand to benefit from falling interest rates, historically wide discounts to net asset value (NAV), and stabilising rental income across several property sectors.
The conversation takes a granular look at the UK commercial real estate market, analysing trends across offices, retail, industrial, logistics and residential development. Despite macroeconomic headwinds, rents and occupancy levels have shown resilience, and development pipelines remain constrained – especially in sectors facing regulatory deadlines such as EPC compliance. Investment volumes have also risen, with notable interest from international capital, further strengthening the case for a sector that may be undervalued relative to its fundamentals.
This episode explores not just whether UK REITs are now ‘cheap’, but whether they are mispriced. With macro triggers in place and underlying performance indicators stabilising, there is reason to reengage with the sector – cautiously – but with renewed interest.
This presentation is the latest in Mike’s series, The REIT Report – watch the rest on YouTube.
Read Mike’s accompanying note REITs – a much more positive outlook.
