Assessing Investor Sentiment: A Window Of Opportunity

Source – CBRE: “Assessing Investor Sentiment: A Window Of Opportunity”

I believe that CBRE has felt the winds changing. This is more of a follow-up on their recent investor sentiment survey a few weeks ago, but there are some juicy takeaways here. Some solid analysis, and the first sentence of their summary here is 100% the reason why I wanted to cover it in this episode of the Gray Report: “With sellers increasingly aware that they must meet the market to trade, investors and capital are actively looking to invest at value pricing.”

• There’s some powerful implications there in the promise of sellers more willing to come to market at a lower price, but as CBRE writes, there still may be a little bit of a gap between buyer and seller.
  
• Core buyers “quiet in the last 18–24 months, are ready to come off the sidelines at core-plus pricing.”
  
• Core-plus buyers “are seeking value-add pricing, and value-add buyers are after deeper discounts.”
  
• I’m not sure what the distinction is between buyers being quiet for the past year and a half and buyers looking for top tier assets at lower tier prices. Wasn’t the pricing mismatch a large part of what was keeping buyers on the sidelines? I think I’m splitting hairs here, so I’ll just go with the broader point here that CRE investment market activity is set to increase.

The Fed’s latest meeting doesn’t seem to have disrupted expectations for CRE markets, and “CBRE research shows existing oversupply in industrial and multifamily will be absorbed in the near term, opening the way for rent growth in the next few years. Smart money is looking at land for development and working on entitlements to get ahead of this trend and deliver in 2026.”

“The window of opportunity for deep value investing may not stay open for as long as some believe. Ludeman thinks that some investors may wish they had been more aggressive in 2024 and early 2025.”