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Sentiment Regarding CRE, Cap Rates Improves: Survey

Originally published on July 15, 2021 by Michael Tucker for Mortgage Bankers Association.

CRE executives’ market sentiment has improved dramatically from a year ago, reported RCLCO, Washington, D.C.

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Medical Office Sector Becomes More Attractive to Investors: Marcus and Millichap

Originally published midyear 2021 by Marcus & Millichap.

Broader recovery fortifies a positive outlook. Resilient during the health crisis, the medical office segment is in a position of strength. Demographic trends and an anticipated boost in health services are positioned to foster long-term tenant demand that will bolster investor confidence in the sector. Shorter-term, the full-scale reopening of most states’ economies and widespread vaccination efforts have laid the foundation for a broad economic recovery that will fuel continued employment growth in the second half of this year. The expiration of enhanced unemployment benefits in September and many states’ plans to terminate the allowance prior to the deadline have the potential to motivate more individuals to obtain work. Furthermore, the reopening of schools this fall should further aid employers when filling open positions during the final third of the year. The resulting employment growth will raise the number of commercially insured households, lifting health spending and the number of medical visits. Together these factors will fuel health-related hiring and supplement demand for medical office space.

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CRE Investment Up in April, But Deals Are Limited: Data

Originally published on June 16, 2021, by Michael Tucker for Mortgage Bankers Association.

U.S. commercial real estate investment increased in April, but not all pandemic-related problems are in the rearview mirror, reported Real Capital Analytics, New York.

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Home Prices Reach New High as Low Inventory Drives Growth

Originally published on June 3, 2021 by Rachel Conner for Realtor.com.

Realtor.com® Housing Report: Home Prices Reach New High at $380,000 in May

Price Growth Remained in Double Digits for 10th Straight Month in May; Price Growth Moderation Expected Later in 2021
-- Lack of available homes for sale push U.S. median listing price up 15.2% year-over-year
-- The number of homes for sale ended the month 50.9% lower than last year
-- Larger metros offer buyers lower price gains and larger growth in newly listed homes
-- Nationally, homes are selling more than a full month faster than last year and 19 days faster than the typical time on the market from 2017 to 2019
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Investors Spend More Money on Research Buildings

Originally published on June 2, 2021, by John Gittelsohn for Bloomberg.

(Bloomberg)—Even as the remote-work era clouds the future for offices, one segment of the business is drawing cash from investors including Blackstone Group Inc. and KKR & Co.

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Spread Between Retail and Industrial Property Rents Continues to Compress, JLL Reports

Originally published on May 20, 2021. by Michael Tucker for Mortgage Bankers Association.

JLL, Chicago, reported the spread between retail property rents and industrial property rents is compressing as home deliveries speed up and e-commerce steals more and more market share from brick-and-mortar retailers.

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Outlook Mostly Positive for CRE as Lockdown Eases: NAR

Originally published on May 7, 2021, by Quintin Simmons for the National Association of Realtors.

WASHINGTON (May 7, 2021) – The U.S. economy experienced one of the swiftest declines in history last year, followed by a quick and relatively significant recovery in the second quarter of 2020. Speakers at today's Commercial Economic Issues and Trends Forum, held as part of the 2021 REALTORS® Legislative Meetings & Trade Expo(link is external), discussed these historic shifts in the nation's economy over the past 12 months while projecting a favorable outlook for the commercial real estate market in the coming year.

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Investors Take a Shine to Car Wash Properties: Report

Originally published on April 21, 2021, by Tom Acitelli for Commercial Observer.

Real estate investors looking for a safe place to park money coming out of COVID might consider the humble car wash. The sudsy byproduct of the automotive age has, in just a few short years, become an unusually durable commercial real estate asset.

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Hospitality Sector Improving and Forecast to Continue Getting Even Better: CBRE

Originally published on April 13, 2021, by Michael Tucker for Mortgage Bankers Association.

The hotel sector is coming back–slowly–from its pandemic-related downturn, analysts said.

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Rent is cheap, vacant space is everywhere: Retailers seize the moment to open stores

Originally published on March 18, 2021, by Lauren Thomas for CNBC.com.

For the first time in years, retailers across the country are planning to open more stores than they are closing.

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Companies Say They Have no Plans to Leave Cities or Relocate to Other States: Survey

Despite talk that businesses may move their offices from an urban location to a suburban one, or relocate to a state with more financial benefits, a new survey shows the shift may never happen as 67% of respondents to the Real Estate Market Sentiment Survey said they have no plans to pack up, the law firm Seyfarth reported March 15.

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Major Risk of Bankruptcies, CRE Price Drops, Fed Reports

Originally published by Rich Miller on February 19, 2021, for Bloomberg.com.

The Federal Reserve warned of significant risks of business bankruptcies and steep drops in commercial real estate prices in a report published on Friday.

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Rising Lumber Costs Put Damper on Single-family Housing Starts in January: NAHB

Originally published on February 18, 2021, for the National Association of Home Builders.

Housing production softened in January as rising lumber prices continue to affect the housing industry. Overall housing starts decreased 6.0% to a seasonally adjusted annual rate of 1.58 million units, according to a report from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.

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New Supply of Office Buildings Adds to Vacancy Woes: Report

By Michael Tucker

Cushman & Wakefield, Chicago, reported the recession that began in March is still being felt in the U.S. office market.

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Colliers Survey Shows ‘Surge’ in Commercial Property Investment Expected This Year

Leading diversified professional services and investment management firm Colliers International Group Inc. (NASDAQ and TSX: CIGI) reveals investors are largely optimistic about a market rebound in 2021, according to its new Global Capital Markets 2021 Investor Outlook. Colliers’ research anticipates a 50 per cent surge in investment activity in the second half of the year, pointing to a broad-based renewal of confidence in the property market as a result of recent vaccine developments and continued government stimulus.

“Based on our global analysis, which gives us a bird’s-eye view of investors’ interests and expected appetite, longer-term tailwinds in the property sector remain intact. With a massive volume of equity raised globally and the need for real assets, investors are eager to deploy pent-up capital and pursue opportunities during the year,” said Tony Horrell, Head of Capital Markets | Global at Colliers International. “We expect to see movement up the risk curve this year, with investors exploring all types of assets from senior care homes to public infrastructure projects.”

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Residential Activity Strong, CRE Struggles: Fed Beige Book

Residential real estate activity remained strong in many fed districts even as home prices increased due to inventory shortages, but commercial activity still struggled amid weak conditions, according to the latest Beige Book released Jan. 13 by the Federal Reserve.

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Survey Reveals Continued Challenges for Commercial Real Estate Sector: Deloitte

By Jim Berry and Kathy Feucht

The impact of COVID-19 on the global economy and the CRE industry has made 2020 the most memorable year in recent history. CRE companies have needed to digitize operations, close physical facilities due to extensive lockdowns, and prepare for reopening, while ensuring the health and safety of employees and occupiers and considering the financial health of tenants and end users.

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Nearly Half of Office Tenants Likely to Reduce Square Footage, BOMA Survey Reveals

By David Kitai

A study of the COVID-19 pandemic’s impact on commercial real estate, commissioned by the Building Owners and Managers Association International (BOMA), has found that office users face widespread economic challenges but many remain convinced that in-person workspaces are crucial to their operations. They noted, as well, that landlords and property managers have successfully adapted to new needs during the pandemic.

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CRE Prices Up Overall During Q3: Real Capital Analytics

By Michael Tucker

Real Capital Analytics, New York, reported commercial real estate price growth increased at a 1.4 percent annualized pace in September as gains in apartment and industrial sector prices offset declines in retail and office price.

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Self-Storage Sector Holds Up Amid the Pandemic

By Bendix Anderson

Though the majority of properties were still close to fully occupied, over-eager developers had squeezed too many new projects into growing cities like Phoenix and Orlando, Fla., which put some downward pressure on rents. Then the initial chaos caused by the pandemic rents down further.

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