Altus Group's Q3 2024 Survey Reveals Commercial Real Estate Insights
Key Findings from Altus Group's Q3 2024 CRE Survey
Altus Group Limited, a prominent name in providing asset and fund intelligence for the commercial real estate (CRE) sector, has recently unveiled the findings from its Q3 2024 CRE Industry Conditions & Sentiment Survey. This quarterly research captures vital insights regarding market dynamics, aimed at understanding the expectations and sentiments of seasoned CRE professionals.
Survey Overview
The survey was conducted over a span of weeks, gathering input from 437 experienced CRE professionals across 163 firms in North America. It provides a valuable perspective on the operational challenges and strategies shaping the future of the industry.
Operating Environment Expectations
One of the standout findings from the Q3 2024 survey was that a significant number of participants, 69% in the U.S. and 67% in Canada, feel that the operating environment is becoming increasingly challenging. This trend indicates a consistent pattern observed in the preceding quarter, underscoring the continuing hurdles faced by the industry.
Focus Areas in the Next Six Months
Respondents identified managing existing portfolios and exposures as their primary focus in the upcoming six months. Interestingly, there has been a notable rise in the percentage of professionals intending to deploy capital—an increase of 11 percentage points in the U.S. and 2 percentage points in Canada, compared to the previous quarter.
Transaction Intentions and Market Dynamics
Transaction intentions showed a positive shift, with 89% of respondents in the U.S. and 75% in Canada signaling their intent to engage in transactions. This marks an encouraging growth of nearly 10 percentage points from the last quarter, suggesting a potential rebound in market activity.
Pricing Perceptions
When it comes to pricing, the survey revealed differing sentiments between the two countries. In the U.S., many participants perceive current pricing to be “priced about right,” whereas in Canada, a significant portion of respondents still find the market largely “overpriced.” This disparity highlights the varied challenges and opportunities inherent in each market.
Performance Expectations and Key Concerns
The survey results indicated that industrial and multifamily asset classes are recognized as the top performers, while office space continues to be viewed as the least favorable. Additionally, the overarching concern across both regions remains centered on the cost of capital and prevailing interest rates, which reflect a cautious outlook regarding capital availability.
Insights from Altus Group
Omar Eltorai, the Director of Research at Altus Group, commented on the findings, noting the expression of lingering concerns within the commercial real estate market. Despite the existing challenges, an optimistic outlook for improvements is beginning to emerge. Eltorai remarked that the recent interest rate cut in the U.S. may have a positive impact on investor confidence, potentially inviting those previously hesitant to participate back into the market.
About Altus Group
Altus Group is well-regarded for its innovative solutions in the realm of commercial real estate asset and fund intelligence. The company's approach focuses on delivering data-driven insights through advanced analytics and advisory services. With a dedicated team of approximately 2,900 employees spread across North America, EMEA, and Asia Pacific, Altus Group supports a global clientele in navigating the complexities of the real estate landscape, ultimately empowering investors and stakeholders to optimize their performance throughout the asset lifecycle.
Frequently Asked Questions
What does the Q3 2024 CRE Industry Conditions & Sentiment Survey report about the market?
The survey highlights ongoing challenges in the CRE market but also points to rising optimism about future improvements.
How many professionals participated in the survey?
A total of 437 seasoned CRE professionals contributed to the survey.
What are the main focus areas for industry professionals in the upcoming months?
Professionals are primarily focusing on managing existing portfolios and exploring capital deployment opportunities.
What are the projections concerning transaction activity?
There is a substantial intent to engage in transactions, with 89% of U.S. respondents and 75% of Canadian respondents expressing this intention.
What concerns are most pressing for CRE professionals according to the survey?
The cost of capital and interest rates remain top concerns, reflecting caution about capital availability.
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