What happened
The S&P/ASX REITs index has fallen 17% year-to-date, hit by rising interest rates and Thursday bond market sell-offs. However, retail property transactions reached $13.7 billion in the 12 months to June 2026. MA Financial acquired half of The Glen for $327 million, while HMC Capital enters due diligence for Greensborough Plaza for an indicative $330 million.
Why it matters here
Rising interest rates typically hurt capital-intensive REITs by expanding borrowing costs and reducing property valuations. However, retail assets are proving resilient compared to office towers, benefiting from strong occupancy and buyer interest. Furthermore, the sector maintains 75% debt hedging for 2026-27, offering short-term protection against rate spikes even as refinancing costs increase toward 5%.
What to watch
Monitor upcoming transaction settlements and debt refinancing announcements across major listed REITs like Vicinity Centres, Scentre Group, and HMC Capital.
Source
ntnews.com.au