In the meantime, structural tailwinds just like the accelerated shift to e-commerce are benefiting some actual property sectors comparable to industrial and boosting new ones comparable to chilly storage, Mr. Karlekar mentioned.
“Now the U.S. customers have pushed e-commerce grocery as excessive as it’s within the U.Okay., which is among the highest e-commerce grocery markets,” Mr. Karlekar mentioned.
Chilly storage demand is predicted to proceed ramping up considerably over the following few months as folks purchase extra groceries on-line, Mr. Karlekar mentioned.
Information facilities is one other property sort that has benefited from the pandemic as folks have turn into extra information dependent, he mentioned.
Area of interest actual property sectors comparable to information facilities and medical workplaces will develop to be extra mainstream in 2021, Mr. Karlekar mentioned.
Ms. Lyse agreed. “These property will turn into maybe not fully mainstream however much less different than they was once. The curiosity for all times science and medical facilities has clearly been spurred by the pandemic. Folks understand these items are necessary and there’s now an enormous curiosity,” she mentioned.
Eaton Companions’ Mr. Martenson mentioned plenty of actual property managers have been shopping for and creating portfolios of automobile washes, particularly within the Southwest U.S. the place folks have been transferring throughout COVID-19. The managers see embedded worth in these properties and anticipate to appreciate returns when the financial system bounces again, he mentioned.
On the similar time, workplace — one of many fundamental actual property sectors “is a reasonably difficult area, should you take a look at worth,” Mr. Karlekar mentioned. It is laborious to worth workplace properties as a result of there have been so few transactions, he added.
actual property funding trusts as a harbinger of what would possibly occur within the non-public actual property market, there have been some REITs with New York and San Francisco workplace properties which are buying and selling at pretty discounted ranges, he mentioned.
In Principal Actual Property’s view, 2021 will likely be a 12 months of value discovery and portfolio rebalancing for the workplace sector, Mr. Karlekar mentioned.
The pandemic has rekindled an argument round whether or not there’s an exodus of individuals from the cities to the suburbs. Principal executives suppose the motion to the suburbs could possibly be short-term and reverse ought to employers resolve to drag their staff again to the workplace, he mentioned.
“Gateway cities are having a second of disaster, however they are going to at all times be resilient,” he mentioned. Even with Brexit, “I’d be a idiot to jot down off London and say London is completed,” Mr. Karlekar mentioned.
Managers with publicity to suburban properties say the tide is popping of their path.