- September 1, 2020: Vol. 14, Number 8

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The quest for certainty: Setting up defensive strategies and identifying robust megatrends in uncertain times

by Timothy Bellman

Entering the COVID-19 crisis, real estate market fundamentals around the world appeared largely sound. Demand was adequate to absorb the modest supply volumes in most cities and sectors.

Invesco Real Estate had expected rents to increase, mostly at a gently slowing pace in about 80 percent of the market-sector combinations it monitors worldwide, with retail being the notable exception. Today, however, this is no longer the case. With economies locked down and many tenants in crisis mode, market-level rents are now unlikely to stabilise or increase, until a period of pandemic and economic stability has re-emerged.

Initially, transaction activity continued in Europe and North America, with many deals that were far advanced closing as planned. More recently, examples of delay, cancellation and re-pricing have emerged. This is likely to accelerate. According to RCA data, by June, North American transaction volume was down 16 percent on the same period in 2019. Europe was d

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