5-year Treasury yield for first time since 2007, impacting REITs

The 5-year U.S. Treasury yield climbed above 4% for the first time since 2007, a milestone that could pull investor capital away from REITs and toward fixed-income alternatives. Higher yields raise REIT borrowing costs and make their dividend payouts less attractive relative to risk-free government debt, pressuring profitability and market dynamics for the sector. The move reflects the broader surge in rates that has weighed on yield-sensitive assets across markets. Investors will be watching whether the 5-year holds above 4% and how REIT valuations and capital flows respond in coming sessions.