Job growth in Washington, D.C., has been weaker than in other major metropolitan regions. But the pace of hiring has picked up significantly in 2015. It appears that the D.C. metro region’s office market hit bottom in 2014.
From the Current Issue
London’s West End continued to be the world’s highest-priced office market, but Asia dominated the world’s most expensive office locations, accounting for four of the top five markets.
Midwest secondary markets are experiencing a swell of mixed-use urban development projects. The development growth correlates to population growth as residents move out of the suburbs and into downtown areas.
The CMBS delinquency rate dropped 3 basis points to 5.42 percent in July, after a brief rise in June. It is now 62 basis points lower than a year ago and 33 basis point lower year-to-date.
Global hotel transaction volume reached $42 billion during the first half of the year, driven by cross-border investment. U.S.-based private equity funds remain the largest source of capital flowing into hotels, but the first half of 2015 saw a significant rise in transactions involving investors from China and the Middle East.
Some $101.2 billion was invested in U.S. commercial real estate in deals of $10 million or greater in the second quarter, according to Real Capital Analytics, a 28 percent increase from the same period in 2014 but a drop of 14 percent from the $118.2 billion invested in first quarter 2015.
At the midpoint of the year, at least 939 actively marketed funds were seeking more than $372.1 billion. In January, the FundTracker database was tracking 914 funds with a total target of $353.5 billion. Although some of this jump in numbers is undoubtedly the result of capturing data on funds that were already in the market, the trend is obvious — the market is continuing to grow and expand.
Players in the New York City market, especially those from outside the United States, have been capturing headlines at a torrid pace in 2015. Yet despite rising prices and compressing cap rates, fundamentals in the Manhattan office market certainly appear more stable than when the market took off — and corrected — at the turn of the century.
Real estate debt is positioned to survive and even thrive in rising interest rate conditions. With a relatively favorable lending environment in place, debt-focused investment vehicles are strongly positioned in the market.
Real estate investors traditionally have viewed the office market as the most volatile property sector when compared with apartments, industrial and retail. The behavior of the office market since the 2009 U.S. recession, however, does not show the same degree of volatility as in the past.
Women have made great strides in commercial real estate over the past decades. Recently, Institutional Real Estate Americas asked a number of high-profile women in the industry to discuss the role of women in real estate.
A growing number of investors have turned their focus to secondary markets. Smart investors want to be able to choose between markets that are temporarily being lifted by the influx of capital and general nationwide recovery and those that have qualities that will enable them to outperform over the long haul.
Many recession indicators tend to be unreliable. One signal, however, has foreshadowed the previous seven U.S. recessions. For many interest rate watchers, the yield curve inversion has become synonymous with economic slumps, which raises the question: Can we count on the inverted yield curve to be a leading indicator of the next recession?
The NCREIF Property Index, or NPI, started 2015 on a strong note and continued into the second quarter with a solid quarterly performance of 3.14 percent.
With this month’s edition, we’re completing the cycle by retitling the publications — Institutional Real Estate Americas, Institutional Real Estate Europe andInstitutional Real Estate Asia Pacific — and reformatting the covers, so they have the same kind of high-quality, highly strategic, more academic look and feel that characterized the original format of the old editions of The Institutional Real Estate Letter.
We hear much today about commercial real estate values being at bubble levels, with many investors and commentators sounding alarm bells. I find it instructive when approaching an analysis, and particularly one with a fairly strong consensus, to ask myself: What could everyone be missing? Or, put another way, what could happen to cause a different outcome than the typical, cyclical bursting of a bubble?