ASX real estate shares are drawing attention as 2025 approaches. This follows a mixed year for the sector, in which some shares outperformed and some lagged peers by a wide margin.
With interest rates potentially easing and demand for digital infrastructure rising, top experts believe companies like Goodman Group (ASX: GMG) and Centuria Industrial REIT (ASX: CIP) could be well-positioned for growth.
Let's jump in and see why these two stocks stand out.
ASX real estate stocks poised for growth in 2025
The first ASX real estate share rated highly by brokers is Goodman Group. The ASX REIT has shifted its focus into industrial property and data centres, which are proving to be lucrative opportunities for the company.
Goldman Sachs estimates that there will be up to US$1 trillion invested in data centres over the coming years, providing a large tailwind to players like Goodman.
Its $13 billion development pipeline includes significant data centre projects, which cater to the rising demand for cloud computing and artificial intelligence (AI).
Morgan Stanley is bullish on Goodman's outlook in 2025, according to The Motley Fool's James Mickleboro.
The investment bank has an overweight rating and a $42.40 price target on the ASX real estate stock.
With Goodman shares currently priced at $36.89 apiece, this implies a potential 15% upside at the time of writing.
As we head into 2025, the majority of brokers rate Goodman a buy. According to CommSec, seven brokers are bullish versus three on the other side of the fence.
Centuria Industrial REIT well positioned
Centuria Industrial REIT gives investors the ability to "invest in industrial property via a real estate investment trust (listed property trust)."
Its portfolio contains industrial properties catering to e-commerce and logistics businesses. It currently owns "89 high-quality, fit-for-purpose industrial assets worth a collective $3.8 billion".
As we reported earlier this week, UBS is bullish on Centuria Industrial. It cites valuation and fundamentals as its reasoning for the buy call.
The broker expects dividends per share of 16 cents in FY25 and 17 cents in FY26 from Centuria.
UBS also has a $3.80 price target on the REIT's share price, suggesting a potential upside of 31% at the time of writing.
Meanwhile, the consensus of analyst estimates rates the company a buy, according to CommSec.
For income-focused investors, Centuria's solid dividend outlook and exposure to high-demand industrial assets make it a standout option in the ASX real estate sector.
What could drive ASX real estate shares in 2025?
The Reserve Bank of Australia (RBA) has hinted that inflation is tracking towards its target. If it continues this way, the bank could potentially see lower interest rates.
Lower interest rates typically reduce borrowing costs and boost property valuations, which could provide a tailwind for ASX real estate shares.
If these factors do eventuate, it could be positive for both Goodman Group and Centuria Industrial REIT, in my view.
Experts say both names present opportunities for investors seeking exposure to ASX real estate shares in 2025.
