Originally published on July 15, 2021 by Michael Tucker for Mortgage Bankers Association.
CRE executives’ market sentiment has improved dramatically from a year ago, reported RCLCO, Washington, D.C.
The twice-annual RCLCO National Market Sentiment Survey plunged to a “dismal” 9.2 on a 100-point scale at mid-year 2020 in the wake of pandemic-related shutdowns. An index reading below 30 indicates economic stress or recession. The index improved to 31.6 at year-end 2020 and 89.1 in June, returning to a high not seen since mid-2015.
RCLCO noted the result reflects “strong optimism” as vaccination rates approach herd immunity levels, business restrictions have been lifted and a drop in cases nationally spurs the economy and real estate markets toward recovery.
MBA Vice President of Commercial Real Estate Research Jamie Woodwell said there have been two fundamental questions throughout the pandemic: how properties would fair during the pandemic and what the world would look like on the other side. “Commercial real estate markets are suggesting that the first question has largely been answered with a focus now on a post-pandemic world,” he said. “Absent a resurgence of the virus, the economic outlook serves as a strong positive for commercial real estate demand, with property type continuing to be the key differentiator.”