Economy Watch: CRE Investors to Keep Up Buying in ’17

Investor appetite for non-core assets increased significantly in 2017, with industrial replacing multifamily as the most attractive asset type, according to CBRE's recent investor intentions survey.
Source: CBRE Research

Source: CBRE Research

Investors focusing on commercial real estate in the Americas have no plans to scale back their investments this year, according to the recently released CBRE Americas Investor Intentions Survey, which queried about 1,000 investors. Fully two-thirds of them intend to be net buyers this year, taking in more acquisitions than dispositions.

Moreover, 40 percent of the respondents expect their purchasing of CRE to rise in 2017 compared with last year, while 18 percent expect the volume to decrease. These numbers are backed up by record levels of capital allocated by investors to North American properties for this year, some $144 billion, according to CBRE.

Investors’ appetite for solid secondary (non-core) assets increased significantly in 2017, the report explained. As for investment strategy, value-add remains the preferred one among investors (39 percent), which is about the same as in 2016.

Reversing 2016 trends, industrial is now the most attractive property type among investors, replacing multifamily as the darling. Los Angeles is the top-ranked metro for property investment, followed by Dallas and then New York and Washington, DC.