Ares Real Estate Income Trust Posts 45% Industrial Rent Surge, Raises $401M in Q1
Ares Real Estate Income Trust, a nontraded perpetual life real estate investment trust sponsored by Ares Real Estate, reported 45.2% rent growth across its industrial portfolio on a GAAP basis in the first quarter of 2026. Its aggregate net asset value stood at $3.39 billion at the end of March, a 6.4% increase from the previous month.
The NAV per share rose from $8.12 to $8.1467, a 0.33% increase, with the larger aggregate gain driven primarily by the issuance of 22.6 million new operating partnership units in Delaware statutory trust conversions.
As of the end of Q1 2026, the REIT’s portfolio reported a 94.8% occupancy rate. The company’s footprint spans 144 properties totaling approximately 30.5 million square feet across 34 U.S. markets.
Comparable industrial leases executed during the trailing 12 months ended March 31, 2026, rose a significant 45.2% on a GAAP basis and 30.5% on a cash basis. Despite these increases, management estimates that industrial rents remain 20.6% below market rates, suggesting mark-to-market upside as older leases expire.
Conversely, the residential sector saw a slight cooling, with a 1.7% average rent decline on new and renewal leases over the same period.
The weighted-average remaining term of the REIT’s total leased commercial portfolio was approximately 5.6 years based on annualized base rent and 4.6 years based on leased square footage, excluding renewal options. Its five largest tenants, based on annualized base rent as of March 31, were: Amazon/Whole Foods, Stop & Shop, S.P. Richards Company, MF Warehouse, and FedEx.
The REIT raised $401.2 million in gross proceeds through its offering, distribution reinvestment plan, and DST program. Of that total, $29.2 million were DST interests. During March 2026, the company issued 22.6 million operating partnership units in exchange for DST interests for a net investment of $183.2 million, and paid $1.6 million in cash in exchange for DST interests.
The company acquired a self-storage property for $11.2 million during the quarter. The REIT’s “other” property category, which includes self-storage and data center properties, represents approximately $800.5 million of the total $7.69 billion real estate portfolio as of March 31.
The REIT fully satisfied all redemption requests for the quarter, totaling $40.2 million. It carries a leverage ratio of 33.4%, with a weighted-average interest rate on borrowings of 4.82%.
The REIT authorized monthly gross distributions of $0.03450 per share across all share classes, paid to stockholders of record through March.
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