Building momentum uphill is a tough ride and keeping it is another ball game, more so in markets. The bulls know it only too well. Globally speaking, last year real estate markets had such an experience going by many the many counts of potentially adverse events that dotted the market line in many locations. However, we’re ankle deep into the new year and the hindsight for 2017 is nothing but inspiring.
The verdict as stated by JLL; global real estate markets broke several records in 2017, with investment and leasing volumes at their highest levels for a decade. That implies a new peak has already established in the markets, and with that, the global foresight for real estate markets this year is thoroughly optimistic.
According to JLL, many real estate markets had an impressive run to the end of the year, a clear signal for robust fundamentals in those markets. Indeed, there is up to this time, a critical mass of optimism about the potential market upturns sufficient sway investor sentiment s in favour of the market and that is happening already in many markets.
Over the past month, it has been a rare event to spot a negative headline about the market in comparison to the final months of 2017. Perhaps it could be dismissed the normal tendency to inflate confidence out of proportion, but only retrospectively after the next 11 months
Investors, already stimulated by the rampant positivity, have ramped up their appetite for property banking on the great expectations. Caution, prudence, due diligence, ROI and value are still watchwords however as individuals and businesses alike continue to enlarge their real estate interests.
Comments aside, here are the facts:
London retained its position as real estate’s most attractive market for capital, and this, despite the much touted Brexit effects with annual volumes going up defiantly by 37% in the year after the Brexit vote.
Global office vacancy rates fell, in fact, office rental growth was at its peak since 2011 and is expected to grow further in 2018.
The concept of co-working space continues to transform the way spaced is used for its contribution to flexibility, thus becoming an important part of corporate real estate. That workspaces have grown 200% over the past five years is truly phenomenal but even more growth is expected in this area as talent and technology continue to drive real estate strategies.
Generally, logistics property too recorded continued growth with unmet demand with e-commerce and third-party logistics becoming increasingly useful occupiers. With increasing demand for modern logistics facilities in some of the markets, 2018 is expected to ride on a stream of robust demand.
Global retailers are adapting to the dynamics of the retail market by exploring new business models which include asset enhancement mechanisms that augment the experience of the shopper. Other structural changes in retail include mixed-use developments, responsive retail and greater customer engagement.
That is all about the hype and steam in global markets, whatever it brings will be interesting to watch.