US Housing Market Update Are rents really falling? We think the recent divergence between the BLS measure of apartment rents and other sources is due to reliability issues with the former, which we expect will be revised higher in future releases... 31st January 2024 · 3 mins read
US Commercial Property Update Direct market values to fall despite signals from REITs Typically, US REIT price indices have been a good indicator of the growth path for capital values in the direct market. That said, even though REIT prices rebounded in Q4 2023, we don’t expect the... 30th January 2024 · 3 mins read
US Commercial Property Update NCREIF Property Index (Q4 2023) The worsening in total returns to -3.0% q/q in Q4 was consistent with our expectations of bigger-than-average year-end markdowns. But the major takeaway was that the data and NCREIF’s release notes... 29th January 2024 · 3 mins read
US Commercial Property Update RICS Commercial Market Survey (Q4) The Q4 RICS survey suggested that occupier and investment sentiment remained pessimistic in Q4. We expect sentiment will be subdued in at least the first half of 2024, with credit conditions staying... 25th January 2024 · 3 mins read
US Commercial Property Update Why we see more distress coming in 2024 We expect evidence of distress to ramp up this year as loan extensions end. Many borrowers will be forced to either inject new capital, return assets to lenders or sell into a soft market. Those... 22nd January 2024 · 4 mins read
US Commercial Property Update Industrial to join offices as worst-performing sector We are downbeat on industrial total returns over the next two years compared to the consensus because of our relatively pessimistic views on both rents and cap rates. And we think the risks to long... 16th January 2024 · 3 mins read
US Commercial Property Update Five key calls for US commercial real estate in 2024 Our total returns forecasts for 2024 are significantly below consensus, as we predict that value falls will reach double digits for the second consecutive year. Retail stands out as the only sector... 9th January 2024 · 4 mins read
US Commercial Property Update A look back on our key calls for 2023 While SVB’s collapse in March and sharper rises in interest rates led to larger-than-expected falls in commercial real estate (CRE) values, our expectations for sector and regional winners were... 3rd January 2024 · 3 mins read
US Commercial Property Update Where will new apartment supply fall fastest? We expect the sharpest fall in apartment completions in 2025-26 in Boston, Denver, NYC and Seattle. Those cities will also be joined by Sunbelt markets where oversupply is already denting rents... 28th December 2023 · 3 mins read
Global Economics Update Key risks for 2024 In this Global Economics Update, we describe eight of the biggest risks to our economic forecasts for 2024. The unusual nature of this cycle and uncertainties surrounding the transmission of monetary... 30th November 2023 · 6 mins read
US Commercial Property Update 2024 rate cuts will provide no respite to price corrections Even though we expect the Fed to go into cutting mode within the next six months and the 10-year Treasury yield to fall below 4% in 2024, we don’t expect this to provide any respite for real estate... 29th November 2023 · 3 mins read
UK Commercial Property Update Higher r* means more pain for property Our recent r* work reinforces the view that property yields will stay relatively high longer term. That implies global returns in low single digits over the next decade or so, well below pre-pandemic... 27th November 2023 · 4 mins read
US Commercial Property Update Where are prospects best for data centers? Since early 2020 there has been a clear divergence in performance between data centers and the traditional commercial real estate sectors. Looking forward, we expect the hyperscale sub-sector will... 20th November 2023 · 3 mins read
US Commercial Property Update Another downgrade to the consensus, but still too sanguine Our forecasts for commercial real estate values remain well below consensus, even after the latest downgrade. While our sector rankings are consistent with the consensus, we are predicting a more... 15th November 2023 · 2 mins read
US Commercial Property Update 2024-27 completions to be below pre-pandemic levels With vacancy set to stay elevated, development finance remaining expensive, and values to continue falling next year, we expect construction starts will be weak in all sectors over the next 12 months... 10th November 2023 · 3 mins read
US Commercial Property Update WeWork collapse adds to office concerns The bankruptcy of WeWork in the US was a predictable end to a long-running saga. Its effects on office markets will not be systemic, but they will reinforce existing weaknesses and pile more bad news... 9th November 2023 · 3 mins read
