The National Observer | Real Estate Edition | Nov. 11 | How much will a recession affect CRE?

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The Urban Land Institute's semi-annual survey of 40 economists and real estate analysts was recently released, giving a glimpse into how those closely tracking the economy are forecasting the next couple of years.

Key economic predictions:?Real GDP growth will hit 1.5% this year, fall to 0.5% in 2023, and rise to 2.1% in 2024; the unemployment rate at year end 2022 will be 3.7%, rise to 4.5% in 2023 and be 4.3% in 2024; the consumer price index inflation rate will end 2022 at 7.5%, fall to 4% in 2023 and decline again to 2.6% in 2024.

Key CRE predictions:?Commercial real estate transaction volume will be $600 billion this year and next, then rise to $850 billion in 2024; meanwhile, commercial mortgage-backed securities issuance will be $80 billion at year-end 2022, $85 billion in 2023 and $100 billion in 2024.

Predictions are just that, and economists during a ULI discussion on Wednesday?said it's impossible to know how much of a recession the U.S. economy could or will face. The depth of a downturn will determine how adversely the real estate industry is affected.

Here are other top real estate stories from around the ACBJ network:

1. The federal government is poised to accelerate its office-space reductions in the wake of the pandemic, a trend that had already been occurring before Covid-19. Tristan Navera and Dan Brendel at the Washington Business Journal delve into what that means for the Greater Washington, D.C. office market.
2. Redfin Corp. is the latest real estate company to disclose more job cuts, with plans to lay off about 862 employees, or 13% of its staff. It's also shutting down its RedfinNow iBuying business.
3. Philadelphia-based Pennsylvania Real Estate Investment Trust is exploring a potential sale or merger, executives disclosed during the REIT's recent earnings call.
4. Downtown vs. the suburbs is not a zero-sum game but for companies in places like Denver, the balance in figuring out office-space requirements — and where to even open an office —?has become more challenging.
5. Are we building too many office towers? This is a more regularly asked question since the pandemic threw the U.S. office market into turmoil and one of increasing relevance as companies exit big blocks of space or put yet-to-be-delivered office square footage on the market.
6. Rayonier Inc. paid $474 million?for 172,400 acres of timberland?in Texas, Georgia, Alabama and Louisiana.
7. Why Industrious LLC CEO Jamie Hodari still sees opportunities to open new offices in places like San Francisco.
8. Homeowners are sitting on near-record levels of equity, thanks to the huge run-up in home values since the Covid-19 pandemic —?and even amid the cooldown that's been seen since early summer. Here are the 30 most equity-rich housing markets across the U.S., as of the third quarter.

Built by Ashley Fahey, editor of The National Observer: Real Estate. Reach me with tips, questions and feedback at?[email protected]