Investors are increasingly ready to pour money into CRE assets, especially in gateway markets offering discounts as well as in high growth Sunbelt markets, according to a recent CBRE survey of CRE investors.
           
Their highest ranked market, for the fourth consecutive year, was Dallas, followed by Miami, Boston, Washington, DC, San Francisco, Atlanta, Raleigh-Durham, Austin and Phoenix.
           
Investment is being encouraged by an attractive CRE pricing environment and strong fundamentals, noted Kevin Aussef, Americas President of Investment Properties for CBRE. “Interestingly, investors are more optimistic about their own prospects compared to the broader market outlook, viewing the ongoing reset in pricing as a key opportunity to secure a first-mover advantage as the recovery gains momentum.”

Two-thirds of investors favor value-add and core plus strategies, hunting for high-return, low-risk assets rather than opportunistic, core, distressed and debt strategies, the survey revealed.
           
Around 75% expect a rebound in their own investment activity by mid-year, and recovery is already under way for more than half. In general, they are prioritizing high-quality assets with an emphasis on multifamily (75%) and industrial and logistics (37%). More investors than last year are also weighing retail and office acquisitions.
           
Indeed, office properties in Miami and South Florida are attracting growing interest, the survey found. “Equity funds are fiercely competing for top-tier assets, while private buyers, both foreign and domestic, remain the deepest source of liquidity. As a result, sales volume and pricing are trending upward, and financing is becoming more accessible, with spreads beginning to tighten,” said Christian Lee, a Miami-based Vice Chairman of Capital Markets for CBRE.
           
Unsurprisingly, investors’ chief concerns are related to high and volatile long-term interest rates and higher operating costs.