CRE AND ECONOMIC OUTLOOK FOR 2H 2024
Economic Soft Landing Remains Baseline Scenario
- With inflation easing and other economic metrics sustaining slow growth, a soft-landing remains the most probably outlook
- A recession is possible if the Fed holds rates too high for too long, but they signaled a willingness to cut rates this year
If There Is A Recession…
- The Fed would likely cut rates quickly and significantly
- But CRE fundamentals would likely weaken as space demand for all property types would weaken
Space Demand and Investor Confidence Could Both Spike
- If the Fed begins its rate cutting cycle, it could reinvigorate confidence, causing companies to boost their expansion plans, resulting in increased CRE space demand
- Increased certainty, lower financing costs and strengthening CRE fundamentals could boost CRE investor activity
*Forecast as of June 10
Sources: Marcus & Millichap Research Services, Blue Chip
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