The Real Risk for REITs Isn’t the Market — It’s Staying Reactive

When the market grows uncertain, asset owners may instinctively pull back. However, conversations with leading REITs across industrial, commercial, and retail sectors reveal a consistent and more dangerous theme — waiting for something to go wrong. Trendspek CEO Derek Feebrey writes.

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Over the past few months, I’ve spoken with several leading Real Estate Investment Trusts across industrial, commercial and retail portfolios.

A consistent theme has emerged: The current way of managing building condition, inspections and capital works isn’t just inefficient – it’s risky, costly and outdated.

And now, it's vulnerable.

The recent global share martket plunge, triggered by newly-announced US tariffs, has rattled investor confidence and sent a clear message to asset managers across sectors: The margin for error is shrinking. Fast.

When markets get shaky, the instinct is to pull back. Delay projects. Defer decisions. Pause spending.

But here’s what I’m seeing from the most strategic REITs right now:

• They’re not spending more. They’re spending smarter.
• They’re not guessing. They’re planning based on real, quantifiable risk.
• They’re not reacting. They’re using data to stay ahead of surprises.
  
  

How did we get here? The growing challenges for REITs

In the past few months, I've worked with REITs facing 36+ challenges across operations, safety and capital works.

Common threats, that come up again and again include:

• Asset data is scattered or sitting in people’s heads
• Safety risks from rope access, BMUs and roof inspections
• Incomplete or inconsistent inspection reports
• Surprise remediation costs and budget blowouts
• Difficulties verifying contractor quotes
• Friction between internal teams and external service providers

And most recently, and the most concerning of all:

Some Tier 1 engineering firms are refusing inspections altogether due to rising liability risks – especially after recent fatalities.

In stable markets, these issues are costly. In volatile markets, these issues are dangerous.

A look at the common risks by percentages

When performing risk audits for our clients, some recurring themes have come up.

The scores from these risk audits have consistently highlughted the following top four areas of risk: Planning (17.1%), Monitoring (16.4%), Decision Making (14.3%) and Record-Keeping (13.6%)

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