‘Uncertainties’ in Valuations Worry CRE Investors: Survey

By Dean Boerner

As public equities-laden pension funds reel from massive hits leveled by stock market volatility this year, commercial real estate will likely continue growing in importance for institutional investors in the long term, experts say.

In the short term, however, new equity deals from institutional investors have slowed, and many deals underway prior to the coronavirus pandemic have fallen by the wayside. About 90% of such organizations have seen deals fall through because of the coronavirus, according to an April survey from the Pension Real Estate Association. In addition, about 70% of investors are at least temporarily scaling back investments in commercial real estate as a result of COVID-19, the disease caused by the coronavirus, according to PREA, which recorded answers from over 70 different institutional investors and investment managers responding between April 9 and April 14.

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