According to Richard Barkham, CBRE Global Chief Economist and Head of Americas Research:

“The U.S. economy bottomed in May, and activity is now cautiously improving. Transaction volumes for commercial real estate will remain constrained due to tightened lending criteria and uncertainty over the path of the virus. We expect weakness to persist in the investment-transaction market for the next quarter at least. When activity picks up, it is likely to accelerate first in the multifamily and industrial & logistics sectors.”


  • Economy: Real time economic indicators such as the New York Fed’s Weekly Economic Index are showing that the U.S. economy bottomed in May. Activity is cautiously increasing. Continued progress on virus control combined with improved sentiment and unprecedented monetary stimulus should drive a rebound of economic activity in this year’s second half. Labor will be rapidly reabsorbed into the economy, bringing unemployment down to around 10% at the year end. A return to pre-Covid 19 levels of 3.5% unemployment will take many years.
  • Global transaction volume is on pace to decline by roughly half in May from the same period in previous years. However, markets have yet to show price reductions, which has kept discount hunters on the sidelines.
  • Lending volumes in the Americas have declined with transaction volumes, but refinancing activity has mitigated the decline somewhat. The most active lenders are banks and government-sponsored enterprises, namely Fannie Mae and Freddie Mac. Life insurance companies are getting more active in lending, but at conservative terms. The CMBS market is returning somewhat but remains challenged. The investment sales market likely will remain muted for at another three to six months, with activity picking up soonest for Industrial and Multifamily real estate and latest for Retail and Hospitality related real estate.
  • Transaction volume for multifamily real estate in April was only one third of its year-ago level. However, few if any price adjustments have occurred, and distressed opportunities remain limited. Financing remains widely available for stabilized properties from Fannie and Freddie and banks. Stabilized means the property has achieved a regular operating level after construction.
  • Industrial & Logistics continues to benefit with investors from its strong outlook relative to other commercial real estate sectors. Most if not all major institutional investors remain active in the sector, and others relatively new to the sector now are interested. Pricing for core assets is holding steady globally.
  • In the retail sector, no transactions occurred in April for malls or powercenters. The strongest subsector within retail is drug stores properties, where transaction volume nonetheless was down 60 percent from a year earlier. Extremely tight lending has contributed to the sharp reduction in transactions. Overall retail transaction volumes were down by roughly 81 percent in April from the 2019 monthly average.
  • Investor interest is heightened in the data center segment, but constrained debt markets have kept sellers on the sidelines. CBRE anticipates an increase in transaction activity once the debt markets further improve. Demand for the both data center and network services remains strong as organizations adapt their infrastructure to accommodate remote working environments.
  • Transaction volume in the office sector remains curtailed by uncertainty about several factors, including the economic recovery, the timing and extent of returns to the workplace, and an inability to conduct in-person property tours. U.S. office transaction volume was down 60 percent in April from a year earlier. Activity is expected to pick up this summer, though the Industrial & Logistics and multifamily sectors likely will get going earlier than office.