Global Property Sector Returns Slow in Q1

Resilient North America Leads Slowdown

The global property sector decelerated in March, as measured by the FTSE EPRA Nareit Developed Index, which posted a modest 1.3% total return for Q1 2026. Broader volatility—driven by rising energy prices and Middle East tensions—helped reverse early-year momentum across most markets. North America emerged as the strongest region, delivering a 4.7% return year-to-date, while Developed Asia and Europe fell to -3.9% and -6.2%, respectively.

Sector Performance Highlights

Globally, the data center sector continued to outperform with a 21.8% total return, reflecting ongoing demand for technology infrastructure. Specialty and healthcare sectors also recorded positive returns at 6.6% and 4.7%. In contrast, the office sector remained under pressure, down 11.4% for the year, and industrial/office mixed and residential sectors posted negative results as well.

Regional Breakdown

North America’s gains were buoyed by tech-driven property types. Data centers surged 23.8%, while the region’s retail and industrial/office mixed sectors gained 6.3% and 11.2%. However, persistent challenges in the office sector (-16.8%) and residential sector (-6.2%) weighed on overall performance. Developed Asia saw only self-storage in positive territory (2.6%), while its retail and industrial sectors posted losses. Developed Europe faced the sharpest declines, particularly in lodging/resorts and self-storage, with its residential sector returning -12.5% in Q1, reinforcing a broader pattern of uneven recovery across European property markets as capital continues to reposition selectively.

What’s Next

Continued macroeconomic headwinds and market volatility are likely to influence property sector performance globally. Technology-driven sectors like data centers remain a bright spot as shifting demand patterns help offset broad-based declines, especially in office and residential sectors.