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Investors Shift Billions from Credit to Real Assets
19 Mar
Summary
- Commercial real estate values fell 22% from their peak.
- Non-traded REITs saw significant gains in recent months.
- Capital is rotating out of private credit into real assets.
Global economic pressures, including tariffs and geopolitical conflicts, are increasing stock market volatility, making hard assets like real estate an attractive portfolio diversifier. Investors are actively rotating capital out of private credit, with a portion flowing into real estate investment trusts (REITs). Despite a 22% decline in commercial real estate values from their April 2022 peak to December 2023, a U-shaped recovery is underway, presenting attractive entry points.
Investments in non-traded REITs, which saw a significant drop in 2025, are now experiencing a turnaround. Fundraising for these REITs increased from November 2025 to January 2026, with gains observed in the third and fourth quarters of 2025. Experts anticipate this trend will continue as more funds exit private credit, seeking yield and stability.
Sectors like data centers, industrials, and multifamily properties are particularly favored for their stability and income potential. While interest rates remain a factor, the current environment of uncertainty is driving interest towards real assets. This strategic shift by investors is expected to continue benefiting the real estate market.
