CBRE Group Inc., a commercial real estate services and investment firm, has released its “2020 Real Estate Market Outlook Report.” The 38-page publication includes forecasts for the capital markets and six real estate sectors, with an “alternatives” category that addresses self-storage and other businesses. Overall, CBRE predicts tempered growth across the U.S. commercial real estate market this year due to weaknesses in U.S. manufacturing, trade-agreement uncertainty and the presidential election, according to the source.
“Next year will bring deceleration on a few fronts, but this still is an expanding economy and a flourishing property market benefiting from a robust job market, solid consumer confidence and low interest rates,” said Richard Barkham, CBRE’s global chief economist and head of Americas Research. “We’ll see resilience across asset classes such as office, retail and multi-family as demand continues to buoy those sectors. And we see transaction volumes and capitalization rates staying relatively stable.”
As a group, the alternatives segment, which includes data centers, life-sciences facilities, medical offices, and senior and student housing in addition to self-storage, has more than doubled its share of commercial real estate investment in the last dozen years, growing from 6 percent in 2007 to 12.5 percent last year. CBRE forecasts investment within the category will match the $59 billion average from the last six years, though sectors like self-storage and senior housing are experiencing oversupply. Factors that are expected to spur continued self-storage investment include attractive capitalization rates and market demand, according to the report.
A PDF version of the publication is available as a free download from the CBRE website.
CBRE Group, a Fortune 500 and S&P 500 company headquartered in Los Angeles, employs approximately 90,000 employees, excluding affiliates, and serves real estate investors, occupiers and owners worldwide. CBRE offers strategic advice and execution for appraisal and valuation; corporate services; development services; investment management; mortgage banking; property, facilities and project management; property sales and leasing; and research and consulting.
Sources:
Mile High CRE, CBRE Releases 2020 Real Estate Market Outlook Report
CBRE, Stability Amid Uncertainty: 2020 U.S. Real Estate Market Outlook
