REITs in 2026: Data Centers, Residential, and Healthcare—Who’s Best Positioned in the USA?

As we approach 2026, Real Estate Investment Trusts (REITs) in the United States are navigating a rapidly evolving landscape. Technological advancements, demographic shifts, and economic factors are reshaping the real estate sector. Among the most promising areas are data centers, residential properties, and healthcare facilities, each presenting unique opportunities and challenges for investors seeking growth and stability.

Investors are increasingly evaluating which REIT sectors are best positioned for long-term performance. By analyzing trends in digital infrastructure, housing demand, and healthcare services, one can identify the sectors likely to generate strong returns in the coming years.

Data Center REITs: Capitalizing on the AI Surge

The demand for data centers has surged due to the rise of artificial intelligence, cloud computing, and edge computing. Data center REITs have reported strong growth in Funds From Operations (FFO), outpacing other sectors. Companies such as Digital Realty Trust Inc. and Equinix Inc. lead this expansion, managing millions of square feet of data center space across the U.S. and globally.

Performance Metrics

• Funds From Operations (FFO) Growth: Data center REITs reported a 21.3% year-over-year FFO growth in Q3 2025, the highest among all REIT sectors.
• Market Capitalization: The sector’s market capitalization reached $185.4 billion, reflecting strong investor confidence.

Leading Companies

• Digital Realty Trust Inc.: With over 300 facilities worldwide, Digital Realty continues to expand its footprint to meet the growing demand for data storage and processing.
• Equinix Inc.: As the world’s largest third-party data center provider, Equinix plans to increase its capital expenditures to $4–$5 billion annually from 2026 to 2029 to support AI-driven growth.

Investment Considerations

While the sector shows robust growth, investors should be aware of potential challenges, including high capital expenditures and the need for continuous infrastructure upgrades to meet AI demands.

However, challenges remain. Rising electricity consumption and energy costs, along with infrastructure development delays, could impact expansion timelines. Despite these hurdles, the long-term outlook for data center REITs remains robust, supported by the ever-growing need for digital infrastructure.

Residential REITs: Navigating Housing Demand and Affordability

Residential REITs are experiencing a dynamic phase driven by shifting housing demands and affordability concerns. The single-family rental market has grown as investors seek stable income streams, while manufactured housing offers cost-effective living solutions in high-demand areas.

Market Dynamics

• Single-Family Rentals (SFRs): SFRs have gained popularity as investors seek stable income streams amidst economic uncertainties.
• Manufactured Housing: This sector offers cost-effective living solutions in high-demand areas, appealing to both investors and residents.

Challenges

• Construction Costs: Rising construction costs can impact the development of new properties, potentially affecting supply and rental rates.
• Zoning Restrictions: Local zoning laws can limit the development of new residential properties, constraining supply.
• Migration Patterns: Shifting migration patterns, influenced by factors like remote work, continue to influence demand dynamics across different regions.

Strategic Outlook

Investors in residential REITs must remain agile, adapting to these changing conditions to capitalize on emerging opportunities.

Challenges for residential REITs include construction costs, zoning restrictions, and the impact of migration and remote work patterns on regional demand. Investors must remain flexible to capitalize on emerging opportunities within the residential sector.

Healthcare REITs: Benefiting from Demographic Trends

Healthcare REITs are poised for growth thanks to demographic trends and increasing demand for healthcare services. An aging U.S. population drives the need for senior housing and healthcare facilities. Companies such as Welltower Inc. are reporting strong growth in FFO and same-store net operating income from senior housing properties.

Performance Indicators

• Funds From Operations (FFO): Healthcare REITs have seen solid gains, posting returns of 8.5% as of May 28, 2025, positioning them as one of the top-performing REIT sectors.
• Net Operating Income: Same-store net operating income from senior housing properties rose by 23% in Q3 2024.

Leading Companies

• Welltower Inc.: Welltower raised its annual FFO forecast, citing robust demand for its assisted living and senior housing properties.
• Healthpeak Properties: Healthpeak continues to expand its portfolio, focusing on life sciences and senior housing sectors to capitalize on demographic trends.

Investment Considerations

The healthcare sector’s defensive attributes, such as long-term leases and essential services, provide stability and resilience, even during economic downturns.

Healthcare REITs offer defensive attributes like long-term leases and essential services, providing stability even during economic downturns. This makes them attractive for investors seeking reliable returns in a volatile market.

Sector Comparison Overview

Investment Outlook

As of late 2025, the market performance of leading companies is positive, indicating investor confidence in growth prospects:

• Digital Realty Trust Inc (DLR): $172.92
• Omega Healthcare Investors, Inc. (OHI): $41.05
• Welltower Inc. (WELL): $177.71

Data center and healthcare sectors show particularly strong market reception, reflecting optimism about long-term expansion and stability.

Conclusion

In 2026, the U.S. REIT landscape will be defined by sector-specific dynamics:

• Data center REITs benefit from growing digital infrastructure demand but face energy and development challenges.
• Residential REITs must navigate housing demand and affordability, requiring strategic flexibility.
• Healthcare REITs gain from demographic trends and essential service demand, providing stability for investors.

Smart investors will evaluate the unique drivers and challenges of each sector to position their portfolios for sustainable growth in the evolving market.

In 2026, the REIT landscape in the United States is characterized by sector-specific dynamics. Data center REITs are benefiting from the surge in digital infrastructure demand, though they must navigate energy and development challenges. Residential REITs are adapting to shifting housing demands and affordability issues, requiring strategic agility. Healthcare REITs stand to gain from demographic trends and the increasing need for healthcare services, offering stability to investors.