Multifamily Investors Plan to Transact More Soon

Article originally posted on Globe St. on March 27, 2024

A robust 62% of multifamily investors expect to increase their purchasing activity from last year and 40% expect to sell more, according to CBRE’s 2024 Global Multifamily Investor Intentions Survey in late 2023 of 1,200 investors.

And nearly half (47%) of multifamily investors view high risk, such as opportunistic, distressed, and debt as the most attractive investment strategy in 2024.

Investors were most bullish about multifamily in the Americas, with 41% saying their purchasing would increase by at least 10% in 2024.

Student housing is the most preferred alternative sector, particularly in Europe, where half of all investors favor it.

Build-to-rent or single-family rental housing was the second most preferred alternative sector among America’s investors at 39%.

These are part of several upbeat investor sentiments found, despite persistently, high interest rates, tight, credit, availability, and softening fundamentals.

For the first time in this survey’s eight-year history, multifamily was the preferred sector in all three main global regions, Americas, Europe, and Asia Pacific.

Industrial and logistics remain the second most preferred asset type this year, favored by 23% of respondents versus 28% last year.

For apartment developers, Sunbelt markets were the most attractive for investment in the Americas. Dallas Fort Worth remains the most targeted market in the Americas. Atlanta and Charlotte gained enough favor to enter the top five on the list.

Almost 60% of respondents expect to see small or no price discounts for multifamily assets this year, up slightly from 2023, and 34% expect mid to large discounts.

Investors are far more optimistic about their own holdings. Nearly one-third of multifamily investors expect their investment activity to begin recovering in the first half of 2024 versus only 9% who expect the same for the overall multifamily market.