Postal Realty Bets on USPS, Despite Drop in Mail

Postal Realty Trust has built its business on a specific asset: the U.S. post office. Now, the real estate investment trust that owns nearly 7 percent of all USPS-leased facilities is doubling down, even as the future of its star tenant looks increasingly uncertain.

The company, led by chief executive officer Andrew Spodek, is the only publicly traded REIT focused entirely on postal real estate, according to Bloomberg. Its 1,700-property, 6.5-million-square-foot portfolio spans from tiny rural outposts to major mail sorting centers.

Postal Realty’s roots trace back to Spodek’s childhood, when his family began collecting postal assets — and memorabilia. That obsession has paid off: the company has kept occupancy above 99.5 percent while posting steady growth in funds from operations since going public in 2019, buoyed by annual rent increases on lease renewals.

But the mailbox boom is over. USPS mail volume dropped 46 percent between 2008 and 2023 and the agency’s inspector general projects another 29 percent decline in key categories over the next decade. Congress has signaled that structural reforms may be unavoidable. One economist testifying before lawmakers recently called the Postal Service’s funding model “broken.”

Still, Spodek isn’t budging, for now. The USPS remains a reliable, government-backed tenant with long-term leases and a mandate to serve every corner of the country — rain, snow or fiscal crisis. And after bottoming out to a five-year low in February, Postal Realty’s stock has surged 19 percent, outperforming the broader market and REIT peers.

Behind the scenes, USPS is trying to pivot. David Steiner, a former FedEx board member, took over as postmaster general last month, fueling speculation the agency may lean harder into parcel delivery to stay relevant. That shift could mean more investment in logistics hubs and fewer sleepy outposts, creating both risks and opportunities for Postal Realty.

Spodek sees potential in broader government use of post offices, from EV charging to census data collection. His team fields pitches regularly but says the real hurdle is Washington inertia.

“They have to be focused on it,” Spodek told the outlet. “They have to want it.”

For now, he’s holding the line, betting that the post office’s physical footprint — like the mail itself — will keep showing up, even if fewer Americans are waiting at the box.

— Holden Walter-Warner