Volatile & Resilient: Panelists Look Into CRE Capital Markets
Experts painted a picture of a market in transition, navigating uncertainties, and the adoption of prudent strategies.
OLYMPIC VALLEY, CA—At the GlobeSt. Women of Influence conference’s breakout capital markets session, industry experts delved into significant trends shaping the commercial real estate capital markets. Moderator Ellen Comeaux, Commercial Division Leader of TIAA Bank, highlighted the remarkable performance in 2021 and 2022, with record-breaking results. However, she acknowledged that the landscape is currently marked by uncertainties, including bank failures and increased regulatory scrutiny, leading to a cautious market sentiment. As a result, the volumes observed in 2021 and 2022 are not reflective of the current market conditions, although she expects stability to return in 2024.
Natalie Greenberg, Chief Operating Officer of MJW Investments, also noted a decline in acquisition volume and refinancings since mid-2022. Her company, in particular, has made fewer purchases, but has been focusing instead on optimizing operations, managing expenses, and addressing assets with floating rate loans. Overall, she pointed out the significant shift from a year and a half ago.
Eliza Gozar, SVP of Investments at Sabra Health Care REIT Inc., shared similar insights, emphasizing the substantial drop in volume. For Sabra Health Care REIT, they have become highly selective in deploying capital, leading to strategic dispositions in recent years. This approach reflects the cyclic nature of the market, she said.
Comeaux highlighted the current challenges facing the industry, particularly the need for conservative underwriting. She now devotes considerable time to advising her sales team as the environment demands more cautious assessments. The uncertainty surrounding interest rates adds complexity, especially for fixed-rate lenders like her institution.
Overall, the panelists painted a picture of a market in transition, navigating uncertainties, and adopting prudent strategies to thrive in the evolving landscape.
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