AEW forecasts UK to be most attractive in 2023 European outlook as recession looms, debt re-financing issues return

AEW has released its European Annual Outlook for 2023, which examines how investors can position themselves for the significant political, economic and financial disruptions that are changing the landscape for real estate investment, as the long post-Global Financial Crisis (GFC) cycle comes to an end.

Key findings of the report include:

AEW’s new base-case scenario assumes that we arepast the peak of inflation across the 20 countries covered, which is expected to come back down to below the 2 percent target adopted by central banks by early 2024 after they hiked rates and initiated monetary tightening, according to Oxford Economics. Despite low unemployment and a successfully managed rebound from COVID lockdowns, AEW’s base case scenario assumes higherbond yields as well as a short and shallow recession in fourth quarter 2022 and most of 2023. Reflecting the heightened uncertainty, AEW’s downside scenario assumes a longer rec