Commercial Real Estate Investment Up 45% Year-Over-Year

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AfterĀ a banner yearĀ of CRE investment in 2021, 2022 isĀ off to a solid start.

Reports from bothĀ ColliersĀ andĀ CBREĀ for the first three months of this year found that investment in CRE isĀ upĀ and, by some accounts, setting records.

U.S. transaction volume hit $161B, a first-quarter all-time high, ColliersĀ found.Ā CBREĀ clockedĀ total transaction volume at $150.4B, which was a 45% increase over the same time the year before.

Volume was up for all asset classes, but unsurprisingly, multifamily took the top spot, capturing $63B, according to Colliers. That amounts to a 56% increase year-over-year and sets a new record for multifamily, according to Colliers.

By CBRE’s count, multifamily also took the lead, but CBRE found it garnered $57B in investment volume, a 42% increase over the previous year’s first quarter. It is common for brokerages to have different numbers based on their research metrics, including size of deals tracked.

Greater New York and greater LA were in theĀ No. 1 and No. 2 spots for transactions, respectively, CBRE found. New York saw $63B worth of deals, while greater LA trailed closely behind with $62B worth of transactions.

Earlier this year, CBREĀ forecastĀ that even after 2021’s record highs, CRE investment would continue to grow in 2022.

ThoughĀ interest ratesĀ are moving upward andĀ inflationĀ is soaring, these factors haven’t had an impact on CRE yet, Colliers said, though it also noted those wouldĀ likely be reflected in dataĀ later in the year because there is a lag between interest rates being hiked and deal flow effects.

CRE is often called an inflation hedge, andĀ the interest in CRE this year could be seen as confirmation that investors viewĀ property as an investment thatĀ could withstandĀ the uptick, but now some investors have begun toĀ make movesĀ that indicate they aren’t sure how much longer that will hold true.


Source: Bisnow