Stable outlook amid uncertainty on low vacancies, rent growth, adequate liquidity

The global view is stable, but risks are increasing. Moody’s expects aggregate rental income growth for real estate companies to be 1 percent to 3 percent, with strength in North American housing, logistics, tech infrastructure and healthcare. That helps offset weakness in Europe, where inflation, the Ukraine conflict and an accompanying energy shortage will hurt results and asset values. Asia Pacific real estate is stable, with e-commerce supporting warehouse demand while retail lags. Tight financial conditions following central bank moves to fight inflation resulted in Moody’s macroeconomic board cutting their global GDP growth forecast to 2.5 percent this year and 2.1 percent next year, which they think will weigh on real estate investments.

In North American, REITs and REOCs are stable. Housing benefits from soaring rents, supported by strong demand, low inventory and solid employment, all while U.S. home prices set records and home supply remains low. Office demand w