Median implied cap rate for US equity REITs climbs further in Q2 2026

The median implied capitalization rate for US equity real estate investment trusts increased 6 basis points quarter over quarter and 2 bps year over year to 7.8% in the second quarter, according to data compiled by S&P Global Market Intelligence.

Cap rates for US equity REITs rose significantly in 2022 and 2023, as the US Federal Reserve’s interest rate hikes raised concerns about the asset class. Although the median implied cap rate has declined from its peak in 2024, it remains elevated.

The analysis included all US REITs that trade on the Nasdaq, NYSE or NYSE American with market capitalizations of at least $200 million at each respective quarter-end and can offer insight into how Wall Street is valuing different property sectors. While valuations within the portfolio of publicly traded REITs might not match all privately owned properties, the public markets can often serve as a leading indicator for potential future property pricing. That insight is particularly helpful when there is little price discovery in the market due to a lack of transactions.

Market Intelligence calculates the implied capitalization rate as property net operating income generated in the last 12 months divided by the REIT's implied real estate value — calculated as market capitalization, including operating partnership units, plus total debt, preferred equity, mezzanine items and noncontrolling interest, less nonreal estate assets such as cash, securities or loans.

Implied cap rates by sector

Hotel REITs posted the highest median implied cap rate among US equity REITs at 11.2%, maintaining their lead for another quarter. Although the figure was down 25 bps compared to the prior quarter, it was 45 bps higher than a year ago.

Office REITs followed, recording a median implied cap rate of 10.7%. The sector posted the largest quarter-over-quarter increase, rising 47 bps. Year over year, the median implied cap rate was up 88 bps.

Specialty REITs — which encompass communications, land, timber, prison, energy infrastructure, casino, golf course and advertising REITs — logged the second-largest quarterly increase, with the median implied cap rate climbing 43 bps to 8.0%.

Residential, data center, self-storage and industrial REITs also posted quarterly increases in their median implied cap rates.

Diversified REITs, on the other hand, recorded the largest quarter-over-quarter decline, down 34 bps to 8.7%. The median implied cap rate for regional mall REITs also decreased, falling 32 bps to 6.6%.

As in the first quarter, self-storage and residential REITs posted the lowest median implied cap rates, at 5.9% and 6.5%, respectively.

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Largest changes in implied cap rates

Timber REIT Rayonier Inc. logged the largest quarterly increase in implied cap rate, with the metric rising 74 bps to 8.6% during the second quarter.

Shopping center REIT SITE Centers Corp. ranked second with a 70-bps quarter-over-quarter increase, while cold-storage-focused Americold Realty Trust Inc. ranked third with a 69-bps quarter-over-quarter increase.

Rounding out the top five, life science office REIT Alexandria Real Estate Equities Inc. and cold-storage-focused Lineage Inc. recorded increases of 57 bps and 51 bps, respectively.

Conversely, advertising REIT OUTFRONT Media Inc. logged the largest quarter-over-quarter decline in implied cap rate, down 128 bps to 19.6%.

Diversified AH Realty Trust Inc. and multifamily-focused Aimco followed, with quarterly decreases of 106 bps and 102 bps, respectively.

Highest implied cap rates

OUTFRONT Media maintained its position as the REIT with the highest implied cap rate for another quarter, closing the second quarter at 19.6%, despite a nearly 1.3-percentage-point decline from the prior quarter.

Americold Realty Trust logged the second-highest implied cap rate for the second quarter at 16.5%, followed by regional mall REIT CBL & Associates Properties Inc. at 15.5%.

Two office REITs rounded out the top five: Empire State Realty Trust Inc. closed the second quarter in fourth place with a 15.0% rate, while Brandywine Realty Trust ranked fifth at 14.8%.

Lowest implied cap rates

Aimco ended the second quarter with the lowest implied cap rate, at 2.8%. On Feb. 6, Aimco's shareholders approved the multifamily REIT's plan to liquidate the company.

Healthcare REIT Welltower Inc. traded at the second-lowest rate, at 3.4%, followed by industrial REIT Prologis Inc. at 4.9%.

Manufactured home REIT Equity LifeStyle Properties Inc. closed the second quarter with the fourth-lowest rate, at 5.0%.