3 Real Estate Operations Stocks to Consider Despite Industry Woes

About the Industry

The Zacks Real Estate Operations industry comprises companies that provide leasing, property management, investment management, valuation, development services, facility management, project management, transaction and consulting services, among others. However, real estate investment trusts or REITs, are excluded from this group. Economic trends and government policies impact the real estate market (both global and regional), which determines the industry’s performance. Economic activity, employment growth, office-based employment, interest-rate levels, costs and availability of credit, tax and regulatory policies and the geopolitical environment are the major factors shaping the real estate market’s fate. Also, pandemic-induced public health challenges and geopolitical issues have affected property sales and the leasing lines of businesses.

What's Shaping the Real Estate Operations Industry's Future?

Global Tensions Disrupt Supply Chains and Growth: Geopolitical instability and macroeconomic uncertainty continue to weigh on industry performance. The Ukraine-Russia war and conflicts in the Middle East have disrupted energy markets and global supply chains, while Strait of Hormuz disruptions have intensified energy prices, freight costs and shipping availability. These challenges, along with U.S. tariffs on imported materials and tighter immigration enforcement, have affected international relations and constrained labor availability. Persistent supply-chain constraints and longer lead times for certain materials and equipment can delay project schedules. Against this uncertain economic backdrop, clients remain cautious, while investors seek greater clarity around pricing and valuations, further contributing to longer transaction timelines.

Higher Costs Weigh on U.S. Real Estate Activity: High borrowing and development costs continue to constrain U.S. real estate activity. Elevated interest rates, higher construction costs, insurance premiums, regulatory expenses and other operating costs are increasing the capital required to acquire, build and reposition properties, making project economics more challenging for developers and owners. These pressures are most acute where expected rents, occupancy or asset values cannot support higher costs, prompting some developers to defer, resize or reconsider marginal projects. In the residential market, affordability remains constrained. Home prices remained near record levels, limiting purchasing power and contributing to subdued transaction activity. For commercial real estate clients, particularly across office, retail, industrial, hotels and mixed-use projects, higher financing, construction and operating costs are driving up total project costs and altering the underlying economics of development and investment decisions.

Outsourcing in the Real Estate Market to Gain Further Momentum: Corporations, public sector organizations, healthcare providers and firms across finance, industrials, life sciences and technology are increasingly opting to outsource their real estate needs. They are relying on third-party real estate experts to improve execution and efficiency. More companies are seeking strategic advice on reshaping their workplaces and operations to strengthen culture, attract top talent and improve overall performance. These trends are opening up opportunities for real estate operations participants. Leading players in the industry are capitalizing on this shift by winning new clients and expanding relationships with existing ones. In addition, companies in the industry are making significant investments in proptech, AI and data tools to boost efficiency, enhance client service and gain market share.

Zacks Industry Rank Indicates Bleak Prospects

The Zacks Real Estate Operations industry is housed within the broader Zacks Finance sector. It carries a Zacks Industry Rank #173, which places it in the bottom 30% of 246 Zacks industries.

The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates bleak near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.

The industry’s positioning in the bottom 50% of the Zacks-ranked industries is a result of the downward earnings per share (EPS) outlook for the constituent companies in aggregate. Looking at the aggregate EPS estimate revisions, it appears that of late, analysts are losing confidence in this group’s growth potential. Since March 2026, the industry’s EPS estimates for 2026 have moved up 2%.

Before we present a few stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.

Industry Underperforms Sector & S&P 500

The Zacks Real Estate Operations industry has underperformed the broader Zacks Finance sector and the S&P 500 composite over the past year.

The industry has declined 5.6% during this period compared with the S&P 500’s return of 22% and the broader Finance sector’s growth of 13.7%.

One-Year Price Performance

Industry's Current Valuation

On the basis of the forward 12-month price-to-earnings, which is a commonly used multiple for valuing Real Estate Operations stocks, we see that the industry is currently trading at 12.57X compared with the S&P 500’s forward 12-month price-to-earnings (P/E) of 20.69X. The industry is trading below the Finance sector’s forward 12-month P/E of 17.11X. This is shown in the chart below.

Forward 12-Month Price-To-Earnings Ratio

Over the last five years, the industry has traded as high as 23.09X and as low as 9.52X, with a median of 13.68X.

3 Real Estate - Operation Stocks to Consider

Newmark Group, Inc.: Headquartered in New York City, Newmark is a leading commercial real estate advisory and service provider for institutional investors and global corporations. The company continues to capitalize on the fragmented commercial real estate market, achieving significant gains in management services, leasing and capital markets. It reported record second-quarter 2026 total revenues of $888.4 million, up 17% year over year, marking its eighth consecutive quarter of double-digit top-line growth.

By investing in advanced technology, expanding its international footprint and focusing on high-growth sectors such as data centers, Newmark remains positioned to capture emerging growth opportunities and deliver consistent performance for its shareholders. It expects 2026 adjusted EPS to be within $1.87-$1.98, reflecting a 15-22% rise year over year.

Newmark Group currently carries a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for its 2026 adjusted EPS increased 6 cents to $1.97. This suggests an increase of 21.6% year over year. The stock has gained 6.5% in the past three months.  You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

CBRE Group: Headquartered in Dallas, TX, CBRE Group is a commercial real estate services and investment firm. The company provides services spanning advisory, building operations, project management and real estate investments to office, retail, industrial, multi-family and other commercial real estate sectors across major global markets. In the second quarter of 2026, it delivered strong results, with revenues increasing 16% and each of its four business segments generating more than 25% growth in Segment Operating Profit.

Its outsourcing business remains a standout performer, bolstered by a robust pipeline that sets the stage for promising future opportunities. Management raised 2026 core EPS guidance to $7.80 to $7.90 per share, reflecting 23% year-over-year growth at the midpoint.

CBRE Group currently carries a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for its 2026 EPS is pegged at $7.74, suggesting 21.32% growth year over year. The stock has gained 16.9% in the past three months.

Jones Lang LaSalle Incorporated: Headquartered in Chicago, Jones Lang offers comprehensive commercial real estate and investment management services globally. The company’s commitment to delivering superior client service, paired with strategic investment in cutting-edge technology and innovation, positions it for significant growth in market share and client relationships. Its second-quarter 2026 results showed record revenue of $6.93 billion, rising 11%.

The company continues to maintain a robust balance sheet with sufficient liquidity to support agile operations and seize emerging opportunities. Looking ahead, JLL remains well-positioned to navigate macro uncertainties while continuing to scale its tech-enabled services and advance its global investment management objectives. Management raised its 2026 adjusted EPS outlook to $24.60-$25.90 from the prior range of $21.80-$23.50. The revised guidance reflects 34% year-over-year growth at the midpoint.

Jones Lang LaSalle carries a Zacks Rank of #3 at present. The Zacks Consensus Estimate for 2026 adjusted EPS increased 5.9% to $24.18 over the past three months. This indicates an increase of 28.62% year over year. The stock has gained 28.2% in the past three months.

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This article originally published on Zacks Investment Research (zacks.com).

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