The "vastly higher" interest rate environment coupled with the possibility of additional rate increases, inflation, and a potential recession is wreaking havoc on developers and investors.

Nonetheless, by focusing on fundamentals, more than a majority (69 percent) hold an optimistic view about 2023, according to Seyfarth's 8th Annual Real Estate Market Sentiment Survey.

That figure is below the 84 percent of CRE executives who believed 2022 would be a year of opportunity, according to Seyfarth. Still, not bad given "the uncertainty of a recession, material office vacancy, retail bankruptcies, and multiple efforts to adopt some form of residential rent control," according to the report.