Durable fundamentals have helped real estate absorb some macroeconomic shocks, but investors are placing greater emphasis on sectors and strategies with resilient income and long-term demand drivers, though this is playing out differently than past cycles, according to Alexia Gottschalch, head of U.S. real estate equity and Jonathan Waldner, director of real estate capital raising at L&G — Asset Management, America. Investors are being more selective by location and property type rather than trusting broad market trends. Active asset management and NOI growth, not cap-rate compression are the drivers of return.
In an exclusive interview with IREI, Gottschalch and Waldner discuss why this real estate cycle is different, citing healthier balance sheets, longer-term financing structures, resilient occupier demand, rental growth, repricing and property-level cash flows. They also discuss how the investor conversation has shifted from predicting when values will rebound to i
