What’s a K-Shaped Economic Recovery and How Does it Impact Real Estate Investors?
Recovery headed toward divergent outlook – “K-Shape” with some sectors reviving & others dragging- Trend emerging in employment data:
– Positive Momentum: Financial Services, Professional & Business Services, Manufacturing, Construction, Education, Health Services and even Retail
– Stagnant: Restaurants, Hotel/Accommodations, and Entertainment - Wide impact by geography too – Reliance on tourism and ability to reopen economies are deciding factors
– Positive Momentum: Midwestern states and much of the South
– Stagnant: New York, Massachusetts, California, Nevada and Hawaii - These trends influence the commercial real estate outlook – Varied impact by property type
- Even within property types, wide spectrum by subtype and local market/submarket/neighborhood drivers
- Current investment landscape is too dynamic and diverse to generalize – Don’t paint with a broad brush
- Review investors individual assets and tie local market knowledge to their investments