The Real Estate Sector Will Bounce Back Next Year
CBRE’s 2021 U.S. Real Estate Market Outlook predicts that offices, retail stores and hotels will begin to recover next year, particularly with news of the Pfizer vaccine looking promising.
The outlook indicates that interest rates will stay low, even with the GDP growing by 4.5% next year. However, the office industry may take longer to bounce back.
“Overall, we expect the real estate recovery, particularly the office sector, to lag the broader economic recovery by several quarters. This follows the pattern of previous cycles but with the added complication of getting people back into the workplace,” said Richard Barkham, CBRE global chief economist and head of Americas research, in the release. “Two factors are essential for this recovery to take hold: a medical resolution to COVID-19 through a vaccine and other measures, and another fiscal stimulus package.”
The Latest News
Delivered To Your Inbox
CBRE expects around 250 million square feet of industrial and logistics space to be absorbed next year, which is more than the prior five-year annual average of 211 million. Additionally, retail space will become more flexible in its usage.
Completed construction will also grow by 29% in 2021, while rents also continue to increase. In the meantime, the office market will begin to recover late next year.
Latest on Daily Digest