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​​​​​​​​​​​​​​​​​​​​​​​​​​​The nature of investment is changing...

…and we are seeing this impact transactions in the second half of 2017. This is happening as the appetite for real estate risk is tightening, and investment sale volumes are cooling in the latter stages of the current cycle. This is evident across equity and debt strategies: ​

  • ​   The pace of fundraising is slowing, down 2.5 percent this year, and real estate dry powder in North America is plateauing at $152 billion;

  •    ​Value add remains the favored strategy for raising and deploying capital, as opportunistic funds are challenged.  As a result, opportunistic funds are sitting on +21.0 percent more dry powder than value add funds, but they have deployed half the capital year-to-date;

  • ​   Investors are shifting toward debt strategies as an alternate path to yield. Life companies are on pace to have another historic year of lending, and debt fund dry powder has expanded 26.9 percent to record levels this year;

  •    Traditional lenders are tightening lending standards and limiting exposure to construction loans, large single asset loans and higher risk assets.​

As we move to year-end with full-year volumes down as expected (a 10.0 percent decline), we expect these shifting market dynamics to apply further downward pressure on volumes in 2018.​

For more detail on the above and other investment trends, download the Q3 2017 U.S. Investment Quick or see the below snapshots of investment activity by asset type.​​​

Industrial investment

Resurgence in industrial portfolios leads sector as lone source for deal
growth in the U.S. Explore the U.S. industrial cap rate map.

Multifamily investment

Transaction activity picks up in Q3, but 2017 is falling short of 2016’s
record mark. Explore the U.S. Multifamily cap rate map.

Office investment

The changing nature of transactions and elevated barriers to the coast markets are inhibiting office investment. Explore the U.S. Office cap rate map.

Retail investment

Retail volumes continue to drop as large investors pull back from the
sector due to sustained uncertainty. View the U.S. Retail cap rate map.

Hotels investment

Hotels volumes supported by hotel REITs and continued activity from private equity funds. View the U.S. Hotels cap rate map.

Net Lease investment

​​As pricing and opportunities start to plateau across sectors, varied buyer types are increasing their focus on the net lease sector. View market snapshot.