Our third annual Global Investor Outlook report explores investor sentiment, asset class preferences, opportunities and strategies in 2023. Our findings are based on numerous in-depth interviews with our Capital Markets experts and survey of more than 750 investors around the world.
After a volatile year of geopolitical tensions, economic shocks and uneven monetary policy, Colliers anticipates the process of stabilization of the global real estate market to take hold by mid-2023. Investors can expect big differences in how the reset plays out across sectors and markets next year. Read the 2023 Global Investor Outlook here.
Key 2023 Americas themes:
- Multifamily is the most sought-after asset class, overtaking industrial.
- Central Business District (CBD) office investors are focused on top-rated, Environmental and Social Governance (ESG)-compliant assets.
- Industrial investors are seeking last-mile distribution properties.
- Grocery-anchored centers remain the top destination for retail capital.
- Luxury hotel assets are still the preferred target for hotel investors.
- Life science, data centers, and student housing remain the top alternative asset classes.
- Investors are concerned about the cost of capital, the impact of inflation, cybersecurity, and talent availability.
The journey so far suggests global real estate market stabilization to take hold mid-2023. But the velocity and timing of stabilization, repricing and recovery will differ across markets and sectors, creating multiple investment opportunities.
Pockets of opportunity exist amidst the current reset as the negative impact on capital values will cause distress among some funds and assets that require refinancing.
Understanding and managing rising cost pressures is critical. 85% of investors said rising construction costs have the most negative influence on their ability to pursue their investment strategies, followed by higher asset operating costs (77%).
Core assets to prevail but non-core will be a source of some distress. 60% of global investors prefer asset classes in established, larger cities, but changing demographic and economic realities are luring them to second- and third-tier growth cities.
Sustainability is driving decisions as the threat of stranded assets looms. 17% of investors are activating a capital improvement, disposal or acquisition strategy that incorporates ESG considerations, up from 10% in 2022.