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2 REITs That Look Attractive in a Stable Rate Environment
Author: Chris Markoch. Published: 2/4/2026.
What You Need to Know
- Rate predictability matters more to REITs than aggressive Fed cuts.
- Simon Property Group shows high-end consumers remain resilient.
- Healthpeak Properties benefits from demographic-driven healthcare demand.
The Trump administration may have unintentionally thrown a bone to the real estate investment trust (REIT) industry. President Trump's nomination of Kevin Warsh to be the next chair of the Federal Reserve provides more clarity—and, importantly, more predictability—about the timing of rate cuts in 2026.
Why does that matter for REITs? These businesses benefit from lower interest rates, but what they need even more is predictability around rates. That uncertainty is a big reason many REITs were hit hard in 2022 and 2023. It wasn't just "higher for longer"—it was the lack of clarity about when rate increases would finally stop.
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Warsh's nomination suggests one or two rate cuts may occur in 2026, but a large move in either direction still seems unlikely.
With that backdrop, two REITs look particularly promising. Both serve specific types of consumers, and both reported solid earnings on Feb. 2.
Simon Property Group: A Temperature Check on the High-End Consumer
It's fair to say that Simon Property Group Inc. (NYSE: SPG) operates properties that cater to the ascending leg of the current "K-shaped" economy. Its results may not reflect the entire consumer base, but they indicate that higher-income consumers continue to spend and are still shopping at brick-and-mortar locations.
That's the key takeaway from the company's fourth-quarter report.
Simon closed 2025 with record real estate funds from operations (FFO), mid-single-digit growth in domestic property net operating income (NOI), and U.S. mall and outlet occupancy in the mid-90% range.
Simon isn't taking defensive measures. The company raised rents in an environment where sales per square foot are higher year over year, and it executed a significant volume of new and renewal leases without resorting to giveaways.
That's not the profile of a company seeing a consumer under broad pressure.
Investors should also note that Simon continues to invest capital in redevelopments, selectively acquire high‑quality retail assets, and return billions to shareholders through dividends and buybacks. This capital allocation stance makes sense only if management believes cash flows from core properties are durable—even if the Fed delivers fewer cuts than the market once hoped.
Healthpeak Properties: A Wellness Check on a Different Consumer
Healthpeak Properties Inc. (NYSE: DOC) specializes in healthcare-related properties—life-science research facilities, medical office buildings, and senior housing communities. The company's latest earnings report showed that growth is coming largely from its senior housing business.
That makes sense: America's aging population has been a trend for much of the last decade and continues to gain momentum.
Healthpeak reported that outpatient medical retained a large majority of expiring tenants and renewed leases at positive cash spreads, indicating healthy demand from health systems and physician groups despite labor and reimbursement pressures.
Senior housing and life-plan communities posted double‑digit cash NOI growth, driven by rising occupancy and strong entry-fee collections.
That performance reflects both demographic trends and some post-pandemic catch-up.
Healthpeak is also preparing a dedicated senior-housing REIT IPO, Janus Living, to unlock value the public market hasn't fully recognized. That mix of pruning and repositioning is exactly what you'd expect in a sector where underlying demand is durable while capital markets remain choppy.
A Barbell Strategy May Be the Way to Gain Exposure
Reinforcing the idea that 2026 could be a comeback year for REITs, both SPG and DOC are up about 2% year-to-date. However, SPG is trading near the high end of its 52-week range, while Healthpeak trades near the low end.
Not surprisingly, analysts give DOC a more bullish short-term outlook. And while both REITs offer attractive dividend yields, Healthpeak's dividend yield is an impressive 7.37% as of this writing.
That said, Simon has been the stronger performer over the past five years. In the past 30 days, analyst sentiment has been bullish on SPG, with several firms setting price targets above consensus.
That combination supports a barbell strategy: pairing SPG-style retail with DOC-style healthcare lets investors bet on both how people spend and how they seek care without going "all in" on either story. SPG provides higher-beta upside—if retail headwinds are overstated and rate volatility eases, you could see operating leverage from rising sales and rents and potential multiple expansion as mall sentiment improves.
DOC, by contrast, offers visibility. Outpatient medical, senior housing, and related healthcare assets tend to grow cash flows steadily thanks to demographics and policy, even if the economy slows. That leg may not surge in a broad bull market, but it can help cushion a portfolio if consumer spending weakens.
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