Pandemic proof: Commercial real estate continues to attract private investment

Pandemic proof: Commercial real estate continues to attract private investment

While some institutional investors may have developed the property jitters during the global pandemic, private capital continued to invest in commercial real estate, according to Knight Frank's new Wealth Report 2021.
The volume of private capital invested globally in 2020 was circa USD232 billion – 9 per cent above the ten-year average, albeit down on 2019 levels – and there's more to come with a quarter of ultra-high-net-worth individuals (UHNWIs) saying they plan to invest in commercial real estate assets in 2021.
"The key factor is that because private capital is under private control, it enjoys unparalleled flexibility where, when and in what sector to invest," says Henrie Westlake, head of Knight Frank’s Leeds office. "This liquidity is key to its ability to take advantage of volatile markets."
The European logistics sector meanwhile, has remained strong with the take up of space reaching record levels last year. New research by Savills says some 26 million sq m of space has been taken in the last 12 months, up 12 per cent on the level observed during 2019 and 19 per cent above the five year average.
Perhaps unsurprisingly, there's rather more mixed news for the retail real estate sector with a new survey by Catella revealing rising yields in many countries across the continent but a reduction in the number of deals being done.
Staying with the retail sector, a new report from the BPIE – the Buildings Performance Institute Europe – highlights that despite industry efforts to decarbonise building portfolios, retail real estate asset managers and owners lack a sector-specific trajectory towards achieving climate-neutrality.
The release of the report marks the launch of Paris-Proof Retail Real Estate, an initiative that looks to develop a vision and strategy to support the European retail real estate sector reach net-zero carbon emissions by 2050, in line with the Paris Agreement.
A new partnership between communications agency Social, meanwhile, and corporate finance advisory firm, Newbridge Advisors, is aiming to help the housing sector to deliver on its ESG goals.
Luke Cross, director at Social Invest says: "Many people across housing say the sector doesn’t always tell its story as well as it could. ESG is an opportunity to do just that. We hope to support the sector in helping housing providers strike the right chord with the right people."
And finally, Seyfarth's 6th annual Real Estate Market Sentiment Survey has revealed the top concerns of commercial real estate industry executives and provided an insight into how they are navigating the economic fallout from the 2020 recession while adapting to new market demands.
Property Funds World

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