Integra Realty Resources (IRR) has recently released their Viewpoint 2024, posing the question of how the commercial real estate market will adapt to ongoing economic changes. These changes include uncertainties surrounding borrowing costs and risk-adjusted equity yield.
According to IRR CEO Anthony M. Graziano, despite the current market downturn, there are significant opportunities arising from these adjustments. He believes that disciplined and well-informed investment strategies will thrive in 2024.
Economist Hugh F. Kelly, who collaborated with IRR’s analysts for Viewpoint’s 31st edition, adds that while the economy shows signs of stability, various pressures affect the real estate market such as a slowdown in labor and housing markets. Investors should approach 2024 with a balanced perspective by considering both risks and potential in different sectors.
Viewpoint 2024 provides an overview of commercial real estate investment outlook from macroeconomic and sector-specific perspectives on a national level:
The Economy: Despite facing multiple headwinds like geopolitical tensions and inflationary pressures,the US economy remains resilient with steady growth in Real GDP.However,careful optimism is necessary given uncertain global economic conditions.
Employment: While employment reflects resilience,it also faces challenges such as strikesand shifting workforce dynamics.This impacts demand for office space,and causes shiftsin multifamily markets.
Interest Rates & Inflation: The Federal Reserve maintaining higher interest rates to curb inflation presents difficulties for borrowing withinthe real estate sector.Adjustments must be made strategically when approaching investments,and this may slow down new developments until at least year-endof
“Significant Opportunities” Emerging from Market Adjustments
