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???? Are CRE investment returns facing new challenges? The commercial real estate market is navigating higher treasury yields, rising costs, and shifting sector dynamics. Despite these pressures, opportunities remain for investors focused on resilient asset classes and long-term portfolio strategies. Explore the trends reshaping returns and what it means for your strategy! #CommercialRealEstate #InvestmentReturns #CRETrends

New York’s investment banks are signaling upswings in two business lines that don’t usually take off at the same time: advising ambitious companies on expansions, while helping others drowning in debt. The rare simultaneous waves of dealmaking and restructurings were the talk of one conference call after another as boutiques including Evercore Inc., Lazard Inc. and Moelis & Co. reported first-quarter results in recent days. It underscores, once again, how enmeshed those firms’ fortunes are with the Federal Reserve’s interest-rate decisions — and how the steepest US inflation in a generation is bending norms. https://lnkd.in/g7mPbNVu

?? Cohen & Steers Sees A New Market Regime for #REITs: Key Insights and Opportunities ???? As the investment landscape shifts, particularly with interest rates, it's crucial to reassess the role of Real Estate Investment Trusts (REITs) in your portfolio. Here’s why REITs are emerging as a compelling investment opportunity in the current market regime. ?? ?? Key Takeaways * Interest Rates & REITs: Lower interest rates, a favorable backdrop for REITs, reduce borrowing costs and enhance asset values. ?? * Attractive Valuations: REITs are currently undervalued compared to equities and private real estate. ?? * Acquisition Power: Publicly traded REITs are well-positioned to pursue acquisitions, with strong capital markets support. ?? ?? Regime Shift to Lower Rates * Favorable Environment: Lower rates decrease borrowing costs, boosting REIT returns and asset values. Historically, REITs have performed well in low-rate environments, averaging 18.9% annualized returns when growth and yields were down. ?? * Dividend Yields: Falling rates make REIT dividends more attractive relative to other fixed-income options, potentially driving higher demand and returns. ?? ?? Attractive Valuations * Valuation Discount: U.S. REITs are trading at a -5.8x earnings multiple spread compared to equities, a rare discount that historically precedes strong returns. ???? * Private Real Estate Comparison: While private real estate values may still be adjusting, REITs typically bottom before private markets, signaling potential upside. ?? ?? Acquisition Opportunities * Capital Market Strength: REITs are capitalizing on tight credit spreads and low financing costs, positioning themselves as net acquirers. ?? Recent Activity: * Lineage IPO: Raised $5.1 billion, marking the largest REIT IPO in history. ?? * Equity Residential: Acquired a nearly $1 billion apartment portfolio from Blackstone. ?? * Welltower? Inc. (NYSE:WELL): Undertook a $5 billion acquisition spree to expand its senior housing footprint. ?? ?? The Allocation Opportunity * Market Performance: Listed REITs rose 7.2% in July, outpacing the S&P 500 and Nasdaq, with real estate being the top-performing sector. ?? * Strategic Advantage: With strong fundamentals and potential benefits from a rate-cutting environment, REITs are a strategic addition to investment portfolios. ?? https://lnkd.in/gYERrvs8

REITs can be a smart investment even during high-interest periods. These publicly traded securities invest in real estate, offering high liquidity and diversification. Historically, REITs often perform well when interest rates rise, as economic growth boosts the value of their properties. However, performance varies by sector and debt levels, so careful selection is key. Consider REITs for income and global exposure in a balanced portfolio. If you would like to learn more about the GOB Family of Funds or fractional ownership in Commercial Real Estate please contact our investor relations team by completing the New Investor Form here: https://lnkd.in/gSZcSqDd will take less than 30 seconds). #gobnetwork #gobiggsorgohome #GOBFund https://lnkd.in/gtvqPbGj

Interesting chart by CRE Analyst on the current appetite in the CRE investment market. The scenario is improving and the recent 25bp reduction in the ECB rates will for sure increase the confidence in future yield compression and borrowing costs decrease. #RealEstateInvestment #Portugal #AtlanticAdvisers

BREAKOUT FOR REITS ? Investors seeking income might consider Reits as interest rates are declining and should decline further as the Federal Reserve gets closer to cutting rates this fall. Congress created Real Estate Investment Trusts in 1960 so investors could own equity stakes in large scale real estate companies. Reits must return a minimum of 90% of their taxable income to shareholders in the form of dividends each year. Reits own apartments, malls, storage facilities, hotels, mortgages and warehouses to name but a few. Investor returns are usually through dividends that are substantially higher than other dividend paying stocks and money market. However, price appreciation is often fleeting especially when interest rates are high. Reits are publicly listed on the NYSE and Nasdaq. Ascertaining the sustainability of the dividend which initially attracts many and the profitability of the sector is key to successful investing in this industry group. For example, high interest rates and the pandemic induced shift to remote work for many has provided negative returns for Reits invested in the commercial building sector. Declining interest rates are generally positively correlated to the return on Reits. On the negative side, higher interest rates are negatively correlated to the return on Reits as many Reits carry significant debt. Homework remains central to successful investing in this sector. Below is a chart of the Reit ETF.

Family offices are turning to private credit for equity-like risk returns. It's gaining momentum as a hedge against stocks and a slowing private-equity market.

?? US #Reits: Poised for Revival with Anticipated Rate Cuts? ?? Introduction: * US real estate investment trusts (Reits) are primed for a comeback in 2024 amid expectations of interest rate cuts. * Despite challenges in office properties, the sector is anticipated to thrive. Key Points: * The Morningstar US Reit index has shown resilience, returning 6.86% over the past year. * However, a 27% loss was recorded in 2022, with a 2.14% loss so far in 2024. * Prospects could change with the Federal Reserve’s potential interest rate cut in June. Insights from Fund Managers: ?? Rick Romano, Portfolio Manager of PGIM Global Select Real Estate Securities fund, anticipates a favorable environment due to lower rates and a strong labor market.Expects increased M&A and consolidation activities to bridge pricing gaps. * Favors sectors like self-storage, apartments, and data centers. Sector Preferences: * Romano's fund holds significant weight in apartments (12.5%) and data centers (11.5%), citing potential for revenue growth and AI-related demand. * Top three positions: Prologis (7.3%), Equinix (6.2%), Welltower? Inc. (NYSE:WELL) (5.7%). Performance & Outlook: * Romano's fund has outperformed the Citywire Property - Global Equity sector average, with a 1.1% return over three years. * Richard Hill, Head of Real Estate Strategy and Research at Cohen & Steers, sees a positive trajectory for US-listed Reits, expecting a pullback in valuations. * Darius McDermott, Managing Director at FundCalibre, highlights Reits' diversifying potential and foresees more promising opportunities with impending rate cuts. https://lnkd.in/gxXhfjQ5

Good news, bad news. [updated chart] 1. Equity availability has generally improved: Core and core plus values are down a lot, which has mitigated redemption queue pressure. Fund investors are less tilted toward the exits when investors think their fund values are closer to market values. Debt conditions have also improved, which has helped leveraged buyers (closed-end funds). 2. A buyer may be emerging: Public REITs are fairly valued (ish), and, critically, they have consistent access to debt and equity. REITs were on their heels over the last 10+ years, but they're gearing up to go on a buying spree, which will likely separate winners from losers for years to come. 3. Non-listed REITs still lag: Plagued by bad headlines and redemption queues, non-listed REITs remain sidelined. BREIT may be almost out of the woods, but we wouldn't be surprised if it gets worse before it gets better for these other non-listed REIT players. Background: Many pundits and commentators talk about the CRE sector like it's monolithic, but it's not. If you want to shed light on problems, opportunities, and likely paths, you have to disaggregate capital providers and assess their relative positions and access to capital. This is our take for the first half of 2024. Correction: An earlier version of this post included typos in headings, which have been corrected.

Inflation?is on a downward trend across many economies, but global events continue to?haunt equity markets. And yet, there are?opportunities to be found. As always, our?investors?have a range of views on how to position themselves in?the current?economic environment. Wise Funds Ltd's?Vincent Ropers, provides his views to?interactive investor?in their latest quarterly addition of - Funds and trusts four professionals are buying and selling: Q2 2024. #quarterlyupdate?#multiasset?#longterminvesting?#fundmanagerviews