Research report - U.S. Real Estate Strategic Outlook January 2023

In A Nutshell

• U.S. real estate investment performance has stumbled in response to rising interest rates.
• However, property fundamentals are robust. While a mild recession might soften leasing momentum, we believe that markets will remain historically tight as construction slides.
• In our view, high interest rates will put further downward pressure on real estate values in 2023. This repricing, amid healthy underlying fundamentals, should create attractive investment opportunities.
• COVID aftershocks have temporarily cooled the industrial and apartment sectors and Sun Belt markets. Nevertheless, our conviction around these investment targets, rooted in longer-term forces, remains undimmed. 
   

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