A New Playbook for a New Paradigm
Today’s real estate markets are undergoing a price correction triggered by sharp interest rate rises and a turn in the cycle. These corrections create opportunities, especially given real estate’s track record of generating high-quality returns over medium and long-term time horizons.
Historically, pricing and fundamentals have typically moved in lockstep — when capital values fall, so do rents — but not this time. Arguably, what we’re seeing is a paradigm shift in the global economy, with multiple secular drivers at work.
Unlike previous corrections, the successful strategies of the past, centered around securing cheap debt to acquire assets and then letting the market do the rest, will likely no longer be enough. Investors need an active strategy that can deliver through-the-cycle solutions to capture the opportunities generated across all phases of the cycle. Such solutions can turn risks into opportunities and maximize returns in the new paradigm.
Also featured in this month's edition:
After nearly two decades of transition, retail is now in a rebased pricing environment offering opportunities to create value and generate risk-adjusted income returns.
Occupier and portfolio company demands, investor requirements, lender preferences and the financial risks of obsolescence drive the economic case for sustainability.
Despite the lag in listed real assets performance in 2023, there are several catalysts for growth amid the ongoing economic uncertainty.
Next Trend Realty LLC./wwwHar.com/Chester-Swanson/agent_cbswan
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