Global investors poured capital into commercial real estate in droves in 2021, though "it was not exactly a risk-on type of trend in acquisitions," Real Capital Analytics' Jim Costello notes in a new analysis.
"Much of this capital was deployed to the asset types viewed as safer in the face of elements of economic uncertainty," he says. "Some elements of this uncertainty are growing into 2022, but it is unclear how the current environment will impact this momentum of capital."
Investors focused their energy on what Costello deems "targeted plays on unique assets where income and expense structures were sheltered" last year—and in 2022, it may well be that they turn their focus to assets resistant to inflationary pressures. But "what is unclear is if each property sector can provide such protection broadly or if such safety is only seen in targeted plays," he says.
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