In case you missed the Chicago Capital Markets Debt, Equity & 2018 Forecast panel put on by Bisnow, here are three takeaways on 2018 trends discussed:
1. In the market, there are a lot of equity sources looking for deals. Some equity sources are taking positions as debt lenders to reduce risk and to find more opportunities to place capital.
2. For Walton Street, capital sources are 50% domestic investors and 50% international with the Mid East and Asia as the main areas providing capital.
3. Industrial / distribution continues to be a strong asset class especially the “last mile” for online deliveries to consumers in metro markets. Hotel and hospitality has relatively high occupancy but valuations have not moved up with the occupancy.
33 Realty predicts that in 2018, the sale of multi-family properties will continue to be strong as buyers look to acquire properties before the increase in interest rates. As interest rates rise, cash flow for properties will be adversely affected and sellers will need to become more flexible on pricing. We also expect CAP rates will begin to gradually move up as interest rates increase this year.
Stay tuned for takeaways from other events coming soon!