Industrial real estate investment trusts (REITs) are entities that own industrial properties, such as warehouses and manufacturing facilities. Manufacturing and logistics companies are increasingly finding they don't need to own their real estate. That's opening the door for industrial REITs to buy these properties and lease them back to industrial companies, helping to drive growth for both groups.
Here's a closer look at the industrial REIT sector, including its advantages and risks, and some industrial REITs worth considering.
Overview
Understanding industrial REITs
Industrial companies use many different types of real estate to develop, manufacture, or produce goods and products. They require specialized real estate to support the movement and storage of products and goods. Properties in the sector include:
- Light manufacturing facilities.
- Food manufacturing facilities.
- Temperature-controlled warehouses (e.g., cold-storage facilities).
- Growing facilities and other properties for medical-use cannabis.
- Flex/office space, meaning a combination of office and industrial space, like a warehouse or light manufacturing.
- Logistics properties such as warehouses and fulfillment centers.
Industrial REITs lease these properties to tenants under long-term contracts, some as long as 25 years. They'll often rent an entire industrial building to one tenant under a triple net lease structure, making the tenant responsible for covering building insurance, real estate taxes, and maintenance. The agreements supply the REIT with steady cash flow.
Advantages
Advantages of investing in industrial REITs
Industrial REITs have a lot to offer investors, including:
- Upside to the growth of e-commerce: Rising online sales are increasing the need for more warehouse space, which these REITs provide.
- Cashing in on supply chain issues: Supply chain disruptions since the pandemic are leading many companies to lease more warehouse space to store additional inventory.
- Capitalizing on the onshoring of manufacturing: Tariffs and other catalysts are leading many companies to bring manufacturing back to the U.S. because of supply chain issues and other factors, providing new growth opportunities for industrial REITs.
- Stable cash flows: Industrial REITs typically sign long-term triple net leases (NNN). These leases produce stable cash flow, often making the sector relatively recession-resistant.
Risks
Risks of investing in industrial REITs
The industrial real estate industry isn't without risk. Notable risk factors to consider include:
- Overbuilding: Many industrial REITs develop new properties on speculation or without securing a tenant before starting construction. Problems arise if developers build too much speculative capacity in certain markets, which can cause occupancy levels and rental rates to decline.
- Tenant troubles: Tenants can experience financial trouble, affecting their ability to pay rent. That can affect a REIT's financial results until it finds replacement tenants for those properties.
- Interest rates: Rising interest rates can increase a REIT's interest expenses, affecting its cash flows. It can also make it more expensive to fund new developments and acquisitions.
Our list
Seven industrial REITs to consider in 2025
According to the National Association of Real Estate Investment Trusts (NAREIT), there were 12 publicly traded industrial REITs in mid-2025. Here are a few interesting ones for investors to consider:
| Name and ticker | Market cap | Dividend yield | Industry |
|---|---|---|---|
| Prologis (NYSE:PLD) | $106 billion | 3.49% | Industrial REITs |
| Rexford Industrial Realty (NYSE:REXR) | $10 billion | 4.08% | Industrial REITs |
| Americold Realty Trust (NYSE:COLD) | $4 billion | 7.21% | Industrial REITs |
| Stag Industrial (NYSE:STAG) | $7 billion | 4.26% | Industrial REITs |
| Innovative Industrial Properties (NYSE:IIPR) | $2 billion | 13.82% | Industrial REITs |
| Lineage (NASDAQ:LINE) | $9 billion | 5.03% | Industrial REITs |
| EastGroup Properties (NYSE:EGP) | $9 billion | 3.31% | Industrial REITs |
1 - 3
1. Prologis
Prologis (PLD -0.42%) is the largest industrial REIT by a wide margin and one of the largest REITs overall. In mid-2025, the company had investments in almost 5,900 buildings encompassing roughly 1.3 billion square feet of space leased to about 6,500 tenants. The company has a global logistics business with operations in 20 countries.
Prologis stands out from other logistics-focused industrial REITs. It has a global reach; most rivals typically emphasize the U.S. market. Prologis also has an investment management platform, enabling it to earn management fees in addition to rental income. Finally, it has a global development platform, which enhances its growth prospects. These differences have enabled Prologis to grow faster than other logistics REITs over the years.
2. Americold Realty Trust
Americold Realty Trust (COLD -2.12%) is one of two publicly traded REITs focused on cold-storage properties. As of mid-2025, the company owned and operated more than 230 temperature-controlled warehouses with about 1.5 billion cubic feet of storage worldwide. Americold leases space in its facilities to food manufacturers, distributors, and retailers. The REIT also manages third-party-owned facilities and provides transportation services.
Americold has been a serial acquirer, enabling it to build the world's second-largest portfolio of temperature-controlled warehouses. Its scale provides it with additional growth opportunities, including acquiring cold-storage facilities and building new ones to support its customers.
3. STAG Industrial
STAG Industrial (STAG 0.6%) owns a diversified portfolio of industrial real estate. It had more than 600 buildings exceeding 118 million square feet of space in mid-2025, including warehouses, light manufacturing, and flex/office space. It leases its buildings to single tenants under triple-net leases. STAG is also highly diversified by tenant, market, and industry.
Aside from its diversification, two factors make STAG stand out from other REITs. First, it's one of the few REITs that pays a monthly dividend. Meanwhile, it doesn't have a development platform. Instead, the REIT primarily grows by acquiring additional properties. It purchases many properties with the intention of adding value through leasing, expansion, and development opportunities.
4 - 7
4. Innovative Industrial Properties
Innovative Industrial Properties (IIPR -0.85%) focuses on owning specialized industrial properties leased to state-licensed cannabis operators. As of mid-2025, the company owned 108 properties with 9 million square feet of space across 19 states.
Innovative Industrial Properties helps provide capital to the cannabis sector. It completes sale-leaseback transactions to acquire dispensaries, cultivation facilities, processing facilities, manufacturing facilities, and other properties that it leases back to regulated operators, giving them the capital to continue expanding their operations.
5. Rexford Industrial Realty
Rexford Industrial (REXR -0.32%) is a pure-play industrial REIT focused solely on the Southern California industrial market. It's one of the largest markets in the world, benefiting from high demand, low supply, and high barriers to entry. Those market conditions keep occupancy levels high, driving healthy rental growth rates.
The REIT owns 422 properties in Southern California with 51 million square feet of space leased to more than 1,600 customers. It steadily expands its portfolio by acquiring new properties, often with the purpose of adding additional value through leasing, expansion, or redevelopment.
6. Lineage Logistics
Lineage Logistics (LINE -0.45%) is the world's biggest temperature-controlled warehouse REIT. The company owns 488 warehouses with 3.1 billion cubic feet of space across 19 countries. It's more than double the size of its closest rival (Americold).
Lineage has grown into the dominant player in cold storage by making a series of acquisitions to roll up the highly fragmented sector. These deals have driven a robust 44% compound annual growth rate in its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) since 2008.
Lineage also expands by investing in expansion projects and new developments. It has built the equivalent of the world's fourth-largest global cold storage company since 2019.
7. EastGroup Properties
EastGroup Properties (EGP 0.14%) is a warehouse REIT focused on high-growth markets in the Sun Belt region. The company primarily owns clusters of smaller facilities (20,000-100,000 square feet) near major transportation infrastructure. It owned more than 63.9 million square feet of properties in mid-2025.
EastGroup has built half of its portfolio from the ground up. It has invested $3.3 billion to develop 271 properties with 31.7 million square feet since 1996. It builds in park-like settings. This strategy drives increased returns with less risk.
The REIT also acquires properties near its existing locations. It focuses on value-add opportunities such as vacant properties or those with expansion potential.
Related investing topics
Many different industrial REIT options
Industrial real estate covers a lot of ground, so many industrial REITs focus on a specific property type. That gives investors a wide variety of ways to invest in the sector.
FAQ
Industrial REITs FAQ
Are industrial REITs a good investment?
Industrial REITs have historically been good investments. Over the past 30 years, the sector has produced a 13.3% average annual total return. That's the second-best in the industry and well above the S&P 500 (8.5%).
Past performance doesn't guarantee the sector will be a good investment in the future. However, the factors driving the sector growth in the past have strengthened in recent years. That makes industrial REITs look like good long-term investments.
What is the largest industrial REIT?
The largest industrial REIT by market cap is Prologis by a wide margin. Its almost $100 billion market cap in mid-2025 was roughly 10 times more than its next biggest peer (Lineage Logistics at nearly $10 billion).
How do industrial REITs differ from other types of REITs?
Industrial REITs differ from other types of REITs in that they focus primarily on investing in industrial real estate, such as warehouses and manufacturing facilities. Another difference is the lease type. Industrial REITs typically sign long-term net leases, which differ from the shorter-term gross leases commonly signed by apartment and other REITs.
Are Industrial REITs recession-proof?
Industrial REITs tend to be relatively recession-resistant. They typically sign long-term leases that provide them with stable rental income. While they often face some tenant-related issues during a recession, the overall stability of their lease base makes the sector fairly recession-proof.
Do industrial REITs pay dividends?
Most industrial REITs pay dividends. The IRS requires all REITs to distribute 90% of their taxable net income to investors via dividends. If a REIT doesn't generate taxable income due to losses, it might suspend its dividend until its financial profile improves.
