Credit: PwC (click to enlarge)Real estate investors believe the office market is a smart investment play, as they project high tenant retention and rent growth in 2012, according to a fourth-quarter survey of investors released today by PricewaterhouseCoopers.

Investors like the capitalization rates offered by office properties, as they remain “favorably priced” in many markets, according to Mitch Roschelle, a partner of PwC’s U.S. real estate advisory practice. “The bullishness on the part of investors in the office sector comes as more office tenants are staying put and prospects for rent growth are improving,” he said. – Adam Fusfeld
[more]

Investors are starting to look at riskier deals and are willing to take on more risk to get returns, as they see signs that the economy is likely to avoid a double-dip recession, according to PricewaterhouseCoopers’ real estate investor survey. “The sentiment among investors has improved significantly from a year ago, demonstrating an acceptance of where the market is today and where it will likely be in the near term,” said Susan Smith, director of the real estate advisory practice at PwC, and editor-in-chief of PwC’s quarterly survey. According to the survey, the national apartment sector is expected to see improvement with positive rental rate trends over the next two years. TRD [more]

Lenders will shift toward amending mortgages next year rather than extending maturities, leading to increased sales of distressed real estate, according to the annual “Emerging Trends in Real Estate” survey, conducted by PriceWaterhouseCoopers. More than 63 percent of the 900 surveyed said they expect maturing loans to be modified, while 7.1 percent said loans will continue without changes to defer losses, a practice known as “extend and pretend.” “‘Extend and pretend’ was the sound bite from a year ago,” Mitch Roschelle, co-chairman of the survey, told Bloomberg News. “Now it’s ‘extend and amend.’ There’s less pretending and more focusing on the reality.” According to a report from PWC, commercial real estate executives have lowered their return expectations. Stagnant wages and high unemployment rates have led landlords and their lenders to focus on current yield rather than expecting prices to rise, the report said. [Bloomberg]

[more]

With the commercial real estate market still struggling to recover, investors remain focused on core assets and proven markets, according to the third-quarter findings of PricewaterhouseCoopers’ Korpacz Real Estate Investor Survey released today. The report found that the apartment sector is continuing to lead the market recovery, with improvements being seen in occupancy and demand. Overall, the office market continues to struggle, the report says. Although the vacancy rate for the national office market improved slightly, job growth and weak tenant demand remain top concerns. The retail sector showed mixed reviews. While leasing activity remained sluggish in the national mall market during the second quarter of 2010, investors noted that the dynamics of the leasing market are stabilizing. TRD

[more]

Susan Smith, PwC real estate advisory director

Commercial real estate investors are feeling frustrated over a lack of so-called “quality” buying opportunities as a result of the widespread perception that purchasing options would have abounded by now, according to a recent report by PricewaterhouseCoopers. The second-quarter survey showed that many investors see less risk in commercial real estate purchases, as the average capitalization rate declined in 17 of the 30 major markets that the study covers. Markets examined in the survey include regional malls, medical buildings and suburban office properties. Susan Smith, director of PwC’s real estate advisory sector, said that the survey is a tentatively good sign. “While most investors sense that the worst is over in terms of market deterioration, supply greatly outweighs demand across all property sectors keeping overall vacancy rates high and rental rates on a downward trend,” Smith said. TRD

[more]

Susan Smith, PwC real estate advisory director

Commercial real estate investors are feeling frustrated over a lack of so-called “quality” buying opportunities as a result of the widespread perception that purchasing options would have abounded by now, according to a recent report by PricewaterhouseCoopers. The second-quarter survey showed that many investors see less risk in commercial real estate purchases, as the average capitalization rate declined in 17 of the 30 major markets that the study covers. Markets examined in the survey include regional malls, medical buildings and suburban office properties. Susan Smith, director of PwC’s real estate advisory sector, said that the survey is a tentatively good sign. “While most investors sense that the worst is over in terms of market deterioration, supply greatly outweighs demand across all property sectors keeping overall vacancy rates high and rental rates on a downward trend,” Smith said. TRD

[more]

PricewaterhouseCoopers released a pessimistic report this week on the state of the national commercial real estate market, suggesting that a recovery for the embattled industry may be a long way off. Robert Sammons, research director with Colliers ABR, sat down with Bloomberg to share his more optimistic viewpoint. He argued that the Pricewaterhouse report was too simplistic and that different regions will see commercial real estate recoveries sooner than others. According to Sammons, Manhattan commercial real estate could recover as soon as mid-2010 because of a slowed construction pace in the city and the subsequent drop in inventory. [more]