ULI’s Fall Meeting in Dallas took place the week of October 24, 2022, and conference attendance was much stronger than in the spring. Here are observations from various sessions over the three days of events:
- With high and persistent inflation, real estate investors are looking at ways to generate cash flow growth.
- The ongoing discussion of how to create more housing across the U.S. was a hot topic. Some attendees suggested having public policy help make the math work on affordable/attainable housing.
- Industrial and multifamily remain the preferred asset classes. However, today’s negative leverage conditions make deals hard to complete. Office ranked last.
- Reaching sustainability goals will require a partnership between real estate owners and occupiers.
- Seniors housing has strong demographic tailwinds, offering a demand boost to the asset class in the coming years. The number of people 80+ years old will grow by 1.1 million by 2027.
Colliers InsightAaron Jodka
“Seniors housing has strong demographic tailwinds, offering a demand boost to the asset class in the coming years. The number of people 80+ years old will grow by 1.1 million by 2027.”
- APAC will continue to be a magnet for capital. Housing offers a compelling play in China, where investors can achieve an opportunistic return on core plus strategies.
- The SEC’s proposed climate-related disclosures would bring the U.S. up to par with other countries, such as those in Europe and Japan. The biggest challenge is that the data needed may not be readily available.
- ULI’s forecast has unsurprisingly become more bearish since the spring meeting.
- Financing the decarbonization of buildings is an ongoing challenge. GSEs Fannie Mae and Freddie Mac have programs, and the green bond market is also available. There is a green premium (better borrowing rates, wider capital available), though a brown discount/stranded assets is a concern in the years ahead.
- The world is in the midst of a geopolitical recession. Historically, these cycles come and go but tend to be driven by shifting power balances and can last for years.
- PwC/ULI’s Emerging Trends Report lists Boston as the only gateway market to rank among the top 10 markets to watch. Nashville was at the top of the list.
- The future of office is still being established. The general opinion is that flexible work is here to stay. However, its ramifications on property values and asset performance vary widely on a building-by-building basis.