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.
Global key themes:
- 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 re-financing.
- 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.