The road ahead could lead to robust economic growth or to a slowdown, each with broad implications for commercial real estate values. In either case, investors should not look to asset appreciation as a given when calibrating their near-term strategies, CBRE’s Chris Ludeman tells GlobeSt.com.
Partly this is due to the age of the current cycle, in keeping with historical norms. “As we get longer in the cycle, where there’s less cap rate compression, investors rely more on property performance to drive value,” says Ludeman, global president, capital markets at CBRE. ‘And that’s what has happened.” The increasingly small share that price appreciation has had in the NCREIF Property Index’s quarterly returns lately is a case in point.
Read more...Investors Shift from Values to Income Stream | GlobeSt.com