The Real Estate Ripple: Catching the Wave?

摘要

Going into the summer of 2004, the commercial real estate market continues to show signs of improvement, with the much-awaited economic recovery providing some upside potential. Despite the general outlook, much hinges on the overall economic recovery, the ability of the Fed to walk the fine line between inflation and expansion, oil prices, and the terrorism situation. Although rising interest rates will be a concern, the pace of increase is unlikely to create major issues for the real estate sector. While consumers are likely to return to "summers as usual," the real estate industry will remain uncharacteristically busy as investors seek to fill appetites, from both debt and equity products. Over- all, real estate fundamentals should exhibit more stability, with gradual improvement rippling across most property sectors and markets. Thus, real estate fundamentals should continue to improve, helping bring prospects for higher returns that will enable the asset class to compete for capital on par with other asset classes. The result will be a very interesting election year, one that could be a turning point in the real estate market.