{"id":1004720148,"date":"2024-07-05T05:39:38","date_gmt":"2024-07-05T13:39:38","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004720148"},"modified":"2024-07-05T05:43:16","modified_gmt":"2024-07-05T13:43:16","slug":"cre-outlook-remains-stable-despite-headwinds","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/cre-outlook-remains-stable-despite-headwinds\/","title":{"rendered":"CRE Outlook Remains Stable Despite Headwinds"},"content":{"rendered":"\n<p>The state of commercial real estate today does not resemble the years of the Global Financial Crisis for several reasons. According to CBRE, fundamentals for most real estate sectors remain near historical norms amid unexpectedly sturdy economic growth.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/07\/Quarterly-investment-CBRE-.png\"><img loading=\"lazy\" decoding=\"async\" width=\"703\" height=\"520\" data-attachment-id=\"1004720187\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/cre-outlook-remains-stable-despite-headwinds\/quarterly-investment-cbre\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/07\/Quarterly-investment-CBRE-.png\" data-orig-size=\"703,520\" data-comments-opened=\"0\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;,&quot;orientation&quot;:&quot;0&quot;}\" data-image-title=\"Quarterly-investment-CBRE-\" data-image-description=\"\" data-image-caption=\"\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/07\/Quarterly-investment-CBRE-.png?w=703\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/07\/Quarterly-investment-CBRE-.png\" alt=\"Fraction of Quarterly CRE Investment Volume as a Share of the Cyclical Peak\" class=\"wp-image-1004720187\" srcset=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/07\/Quarterly-investment-CBRE-.png 703w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/07\/Quarterly-investment-CBRE-.png?resize=300,222 300w\" sizes=\"auto, (max-width: 703px) 100vw, 703px\" \/><\/a><figcaption class=\"wp-element-caption\">Fraction of Quarterly CRE Investment Volume as a Share of the Cyclical Peak. <em>Chart courtesy of MSCI, RCA and CBRE Econometric Advisors<\/em><\/figcaption><\/figure>\n\n\n\n<p>Nonetheless, the dearth of liquidity and price discovery has conjured comparisons with the 2008-09 cycle and current office debt delinquencies are beginning to reflect that time as well.<\/p>\n\n\n\n<p>\u201cIn 2008-2009 a painful economic contraction encouraged companies and banks to hold onto cash,\u201d CBRE reported.<\/p>\n\n\n\n<p>\u201cToday\u2019s suppressed deal volume <a href=\"https:\/\/www.commercialsearch.com\/news\/navigating-cre-challenges-in-a-higher-for-longer-market\/\">owes to high interest rates<\/a> and uncertainty about their future path\u2014quite different from central banks\u2019 post-GFC zero-interest-rate policy\u2014resulting in wide bid-ask spreads and less accommodative credit markets.\u201d<\/p>\n\n\n\n<hr class=\"wp-block-separator has-text-color has-cyan-bluish-gray-color has-alpha-channel-opacity has-cyan-bluish-gray-background-color has-background is-style-wide\"\/>\n\n\n\n<p><strong>READ ALSO<\/strong>: <a href=\"https:\/\/www.commercialsearch.com\/news\/why-the-outlook-is-positive-for-those-in-cre\/\">Why the Outlook Is Positive for Those in CRE<\/a><\/p>\n\n\n\n<hr class=\"wp-block-separator has-text-color has-cyan-bluish-gray-color has-alpha-channel-opacity has-cyan-bluish-gray-background-color has-background is-style-wide\"\/>\n\n\n\n<p>Deal volume was down 60 percent in the first quarter of 2024 compared with the 2022 peak, however the decline is less severe than during the GFC.<\/p>\n\n\n\n<p>Blackstone\u2019s flip of the Equity Office Properties\u2019 portfolio in 2007 exaggerated the subsequent percentage decline in trading volume, CBRE pointed out.<\/p>\n\n\n\n<p>\u201cWe expect deal volume will stabilize further now that the worst of inflation is behind us, and the Fed appears to be done hiking rates,\u201d CBRE\u2019s report indicated.<\/p>\n\n\n\n<p>It calls for deal activity to pick-up, perhaps in early 2025, \u201cbut we do not anticipate an investment volume boom because borrowing costs and cap rates are likely to decline more slowly than in past cycles.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"<p>And why the current situation doesn\u2019t rightly compare to the time of the Global Financial Crisis.<\/p>\n","protected":false},"author":3568,"featured_media":1004720183,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21783,23891,21742,21747],"tags":[32789],"class_list":["post-1004720148","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investment","category-national","category-latest","category-office","tag-cbre"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>CRE Outlook Remains Stable Despite Headwinds - Commercial Property Executive<\/title>\n<meta name=\"description\" content=\"Today\u2019s suppressed CRE deal volume owes to high interest rates, quite different from central banks\u2019 post-GFC zero-interest-rate policy.\" \/>\n<meta name=\"robots\" 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