There is a significant amount of capital on the sidelines waiting to be deployed in commercial real estate deals – estimates as high as $300 billion – but several factors are keeping it in investors' pockets for now, according to a new industry news video by Marcus & Millichap.
If that capital is levered up with a 60% loan-to-value, that would be about $750 billion of commercial real estate sales volume.
John Chang, Senior Vice President, National Director Research and Advisory Services, Marcus & Millichap, said the first issue that is keeping it on the sidelines is the reduced amount of for-sale property on the market, partially driven by the expectation gap.
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