Findings from BDO’s annual survey of Australian Real Estate Investment Trusts (A-REITs)
Findings from BDO’s annual survey of Australian Real Estate Investment Trusts (A-REITs)
Australian Real Estate Investment Trusts (A-REITs) are looking to capitalise on a more predictable macroeconomic environment, with new analysis from BDO revealing stabilising valuations, a rebound in retail, and resilient performance across diversified and alternative property segments in FY25.
BDO’s annual A-REIT survey, now in its 31st year, found that the sector delivered a total return of 10.3 per cent, marginally outperforming the broader S&P/ASX 200 Index by 0.3 per cent. The result follows a 19.9 per cent return in FY24.
The top performing category in FY25 was diversified with returns of 29.9 per cent, up from -5.3 per cent in the previous year, followed by a notable recovery from retail, returning 16.2 per cent, up from 6.8 per cent in FY24.
Scentre Group, which operates Westfield shopping centres across Australia and New Zealand, is a prime example of the retail bounce back, reporting an impressive occupancy rate of 99.7 per cent in June 2025, the highest level recorded since 2017.
Office REITs staged a significant comeback, posting an annual return of 2.6 per cent, up from -18.9 per cent in FY24.
Industrial A-REITs, after years of exceptional returns, suffered a setback in FY25 with negative returns of 1.4 per cent, down from 69.7 per cent in the previous year, reflecting a normalisation in demand and rental growth.
BDO in Australia’s National Leader of Transaction Advisory Services and A-REIT specialist, Sebastian Stevens, said despite the measured growth, there were pockets of strength over the past year.
“FY25 has marked a turning point for the Australian A-REIT sector. After a period of significant volatility and monetary tightening, we’re now seeing stabilisation in valuations and renewed investor confidence across much of the market,” said Mr Stevens.
“Diversification has proven to be a key strength for A-REITs this year. Sectors such as residential, alternative, and diversified trusts have demonstrated resilience, benefiting from structural demand drivers and prudent capital management.”
Outlook ahead
“Looking ahead, the sector is well positioned to benefit from a more predictable macroeconomic backdrop and ongoing demand for quality assets,” said Mr Stevens.
“I believe we are witnessing an evolving office market with growing but restrained confidence in this sector. The main challenges appear to be behind us, as we see a normalisation of work habits and an increasing focus on returning to the office.”
“Capital markets activity has surged, with FY25 seeing the largest ASX IPO in nearly six years and a significant uptick in transaction volumes. This signals renewed appetite for real estate investment and confidence in the sector’s long-term prospects.”
“As we move into FY26, the focus for A-REITs will be on maintaining financial flexibility, embracing ESG imperatives, and capitalising on opportunities presented by demographic shifts and technological change.”
Read our 2025 A-REIT Survey.
For media enquiries:
Jotham Lian
Manager, Media
E; Jotham.Lian@bdo.com.au
Ph: +61 2 8221 2290