AFIRE, the association for international real estate investors focused on commercial property in the United States, today released its 2021 Mid-Year Pulse Survey Report.
The report is a follow up to the AFIRE 2021 International Investor Survey Report, released April 2021, and details evolutions in real estate investor sentiment over the past six months, alongside emergent outlooks for risk management in the US real estate. Both reports are underwritten by Holland Partner Group.
With the guidance of the AFIRE Research Committee, this mid-year “pulse” survey was conducted in August 2021 to allow comparisons in attitudinal changes over the past several months, especially as the trajectories of the pandemic over the past year have forced constant adaptation to strategies and core investment philosophies.
Key findings from the report include:
CYBERSECURITY IS A TOP CONCERN
Three in four investors expect their volume of US real estate iReporting 79% net concern, investor concerns related to cybersecurity have substantially increased compared to March 2021—now ranking higher than taxes and inflation.
WORRIES ABOUT DEURBANIZATION HAVE MEANINGFULLY DECLINED
More than half of respondents in March 2021 indicated deurbanization as a key concern, though this number has meaningfully declined to less than 40%.
APPETITE FOR US OFFICE AND RETAIL HAS DECREASED
Respondents believe appetites for office and retail have decreased over the past two years (81% and 84% respectively)—though this does not indicate inactivity.
ECONOMIC AND POLITICAL RISKS ARE TOP-OF-MIND FOR THE NEXT DECADE
More than 60% of respondents ranked US economic recession as the most significant factor affecting US investments over the next decade, followed closely by global recession (53%)
CLIMATE CHANGE WILL DOMINATE MIGRATORY TRENDS
Nearly 70% of respondents believe that events related to climate change will pose a greater threat to investment than reverse urbanization (migration from US cities)
DIVERSE TALENT AND LEADERSHIP WILL BE CRITICAL FOR THE FUTURE
More than 80% of respondents agree that the US real estate workforce will need to become more diverse in order to manage future risks within and beyond the industry.
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Reprints and/or redesigns are permitted, with the following source attribution in all instances: “Source: As of March 2021; 2021 AFIRE International Investor Survey, underwritten by Holland Partner Group; www.afire.org.”
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ABOUT THE 2021 AFIRE INTERNATIONAL INVESTOR SURVEY REPORT
For thirty years, the AFIRE International Investor Survey has gathered the opinions of AFIRE’s members to construct a useful tool for investors, regulators, and the media to understand the goals, challenges, and impacts of international investments on US real estate opportunities. The initial 2021 International Investor Survey was conducted March 2021 and released April 2021. With the guidance of the AFIRE Research Committee and the diligent work of the PwC research team, this year’s member research project was adapted to meet the needs of the “new normal,” thus warranting a mid-year sentiment ”pulse,” or follow-up, to the Q1 2021 survey. Conducted August 2021, this follow-up allows comparisons in attitudinal changes over the past several months, especially as the vacillating trajectories of the pandemic have forced constant adaptation to strategies and core investment philosophies.
AFIRE is the association for international real estate investors focused on commercial property in the United States. Headquartered in Washington, DC, AFIRE was established in 1988 to provide an essential forum for real estate investment thought leadership. AFIRE membership is exclusive, granted by invitation only, and currently includes more than 200 organizations from around the world representing institutional investors, investment managers, and service providers representing approximately US$3 trillion in assets under management. Learn more at afire.org.
ABOUT HOLLAND PARTNER GROUP
Founded in 2000, Holland Partner Group (HPG) based in Vancouver, Washington, is a fully integrated real estate investment company. HPG principals’ development and acquisition volume exceeds $15 billion, representing 50,000 apartment homes located in the Western United States’ most sought after markets. Our company accomplishes our investment objectives in strategic alignment with our capital partners through our five integrated operating companies, including development, construction, acquisition, redevelopment and property management. Our vertically integrated focus has developed the real estate industry’s most consistent and reliable delivery platforms. Our combined business volume is expected to exceed $2 billion annually through our 750-member team. Learn more at hollandpartnergroup.com.