MIAMI—There was no lack of speculation about how a Trump presidency would impact the commercial real estate market, through taxes, foreign investment, infrastructure projects or otherwise. GlobeSt.com caught up with Blake Okland, vice chairman and head of US Multifamily for ARA, a Newmark Company, to get his take Trump's impact on US multifamily in his first six months as well as international capital flow into the segment.
GlobeSt.com: How has the Trump administration influenced international investment in US real estate as a whole? Multifamily?
Okland: Last month an Israeli investor told me the “US is far and away the most desirable market—and I never thought I'd day that with a man named Trump in the White House.” That said, interest rates have stabilized after a bit of capital markets fluctuation between the election and inauguration.
GlobeSt.com: What are the biggest challenges for foreign investors in 2017?
Okland: Trying to figure out how monetary policy will impact interest rates and if we started to see real volatility in real estate that would be challenging. (Find out why the construction industry is optimistic.)
GlobeSt.com: What will be the defining moment for foreign investors in 2017?
Okland: Progress on Tax Reform and ACA. If those two items progress and provide some near-term certainty to market participants, they provide further stability and likely momentum for foreign investors increasing their exposure to US real estate. (What about Trump's impact on affordable housing? Get one view.)
GlobeSt.com: How can U.S. investors use Brexit to their benefit?
Okland: England was the second-most sought-after country before Brexit. They can take advantage if London pricing starts to drop. Simple case of pricing inefficiency that comes from a market in transition.
London will always be a global city with significant demand for its real estate in perpetuity. Today's uncertainty can relate to some near term drops in pricing but will likely be nothing but an “air pocket” long term. It's not super yield-sensitive, so US investors just want to position themselves.
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