U.S. Economic & Property Market Perspective Q2 2023


It Ain’t Over ‘Til It’s Over
– Yogi Berra

The combination of continued moderation in inflation and higher than expected second-quarter real GDP growth has buoyed both investor and consumer sentiment with growing expectations that the Federal Reserve may be approaching the end of the credit tightening cycle and the U.S. economy may avoid recession and achieve a so-called “soft landing.”

With respect to inflation, the widely watched “headline” consumer price index (CPI) showed a year-over-year increase of slightly more than 3% in June compared with a near 9% increase in June 2022. While it is too early to declare the period of excess inflation fully contained, the data are clearly moving in the right direction. The Fed may want to see various measures of inflation move to or below the policy target of 2% and remain there for some time before they begin to reverse course. On this point, it is worth noting that the same recent inflation report also shows a more modest improvement in core inflation (excluding food and energy prices) with year-over-year growth of nearly 5%, well above the Fed’s longer-term target.

AEW Capital Management
AEW Capital Management

For over 40 years, AEW Capital Management, L.P. (AEW) has provided real estate investment management services to investors worldwide. One of the world’s largest real estate investment advisors, AEW and its affiliates manage $90.7 billion of property and securities in North America, Europe and Asia (as of June 30, 2023). Grounded in research and experienced in the complexities of the real estate and capital markets, AEW actively manages portfolios in both the public and private property markets and across the risk/return spectrum. AEW and its affiliates have offices in Boston, Los Angeles, Denver, London, Paris, Düsseldorf, Hong Kong, Seoul, Singapore, Sydney and Tokyo, as well as additional offices in seven European cities. For more information please visit www.aew.com.
As of June 30, 2023. AEW includes (i) AEW Capital Management, L.P. and its subsidiaries and (ii) affiliated company AEW Europe SA and its subsidiaries. AEW Europe SA and AEW Capital Management, L.P. are commonly owned by Natixis Investment Managers and operate independently from each other. Total AEW AUM of $90.7 billion includes $41.9 billion in assets managed by AEW Europe SA and its affiliates, $5.3 billion in regulatory assets under management of AEW Capital Management, L.P., and $43.5 billion in assets for which AEW Capital Management, L.P. and its affiliates provide (i) investment management services to a fund or other vehicle that is not primarily investing in securities (e.g., real estate), (ii) non-discretionary investment advisory services (e.g., model portfolios) or (iii) fund management services that do not include providing investment advice. Staff, offices, and clients include AEW Capital Management, L.P. and AEW Europe SA and their respective subsidiaries.

Chad Nettleship
Insurance, Investor Relations

2 Seaport Lane
Boston, MA 02210

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