CBRE’s Investor Intentions Survey Shows Improved Sentiment

(Image courtesy of CBRE)

CBRE, Dallas, released its 2024 U.S. Investor Intentions Survey finding that investor sentiment has greatly improved, but concerns such as higher-for-longer interest rates, tight credit conditions and differing buyer and seller expectations still weigh on the industry.

In terms of that sentiment, more than 60% of respondents expect to purchase more real estate in 2024 than in 2023, compared with 16% in last year’s survey.

Developers, private equity funds, real estate funds and REITS plan to buy more assets in 2024 than other investor types.

Additionally, 40% expect to sell more assets this year–that metric was at 14% in 2023’s survey. Private equity and real estate funds reported being the most likely to sell.

“While credit conditions remain challenging, investors are looking beyond the current difficulties. We expect investment activity to gain momentum in the second half of the year as financial conditions improve,” said Chris Ludeman, Global President of Capital Markets for CBRE. “Investors are particularly focused on opportunistic and core-plus strategies as they seek higher risk-adjusted yields.”

While approximately half of investors believe their own transaction activity and that of the broader market will recover in the second half of 2024, CBRE noted this may happen earlier if the 10-year Treasury yield declines more quickly than anticipated.

Investors also reported that Sun Belt cities and high-performing secondary markets are most attractive, with Dallas/Fort Worth, Texas, taking the top spot.

In terms of property returns, Sun Belt cities remained popular, and East Coast cities such as Boston and New York City also ranked highly.

In terms of sector, multifamily and industrial and logistics were deemed most desirable.

Respondents also anticipate pricing discounts across all sectors, with the largest expected for value-add office assets.