Survey Shows Investor Sentiment Recovery


Welcome to this week’s installment on planning and forecasting for your small business! Head over to our Youtube channel and take a look at this survey on WealthManagement.com to dive deeper.

Once again, we’re visiting the Wealth Management Real Estate Marcus and Millshap survey of investors that they do twice per year. Right now, we’re looking at the first half of 2021, and if you recall from our post six months ago, the investor sentiment had fallen quite a bit from the way they measure it, from 166 to 140 in the middle of 2020. It’s understandable because we were in the middle of the pandemic, no vaccines, lockdowns everywhere, etc. But since then, in the last six months, investor sentiment has almost recovered to the high a year ago at 165. This is getting very close to all-time highs, and this sentiment is made up of several factors. We’ve linked to the survey above, so you can get in depth there.

They find that investor sentiment is up, with 74% of the professional investors saying that they are looking for acquisitions currently, which is always a positive sign. They even break it down by industry type and which sectors are in a buy. The apartment sector, the hotel sector, and the industrial sector are in a big buy. All of those have seen increases in buys. Office has seen an increase in buy, but it’s about 50/50 buy/hold. Not much of a buy interest in retail or self storage, but a huge increase in a buy category for senior housing. No surprises there really, but we are actually somewhat surprised the office sector wasn’t bigger on the buy, with some of the movements that we’re seeing, and as we’ve talked about before, industrial properties are highly popular, a lot of that because of the shopping online economy and warehouse space is at a premium right now. So take a look at this survey. It’ll give you an idea of how investors are thinking. It’s a really detailed, really well done survey.

You might ask why we do a segment every week on commercial real estate, and that’s because still in large part we’re very much a real estate based economy. Of course, for generations most of the world has been real estate based economies, but that changed in the 2000’s with a large segment of the economy being taken over by tech. But even tech occupies real estate… it’s interesting to note that Google recently announced target dates and deadlines for when workers are to return to their offices, which sort of flies in the face of people in insinuating that office space is going to be dead. So not true! Companies need to maintain their culture, and you can’t do that when your employees are at home in their pajamas.

So real estate is critically important to most businesses, whether you’re just a consumer, or if you need to watch the trends that are going on in the world around us. That’s why we focus on commercial real estate! As always, give us a holler if you want to chat about how all this relates to your business.

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