Colliers predicts that the real estate investment sector in the second half will witness a “strong recovery”
- Colliers, an international consultancy firm, predicts that the real estate investment sector in the second half of 2020 will witness a “strong recovery”.
- After a thorough analysis of the impact of Covid 19, Colliers concludes that there are reasons as to why the sector should be “cautiously optimistic.
After the last global financial crisis in 2008, the world goes through another one starting with Covid 19’s emergence in the last quarter of 2019. However, Colliers, a global real estate services and investment management company, reports that the recovery from the crisis of Covid19 will be stronger and faster than the crisis in 2008. Starting with the second half of 2020, Colliers’ estimates show that the world will experience a strong recovery that will revitalize finances, and the real estate sector.
Still, these optimistic forecasts should not cloud the overall current situation in the global finances. Global real estate investments in the first quarter of 2020 were the lowest since 2012. First three months of 2020 generated 228.5 billion euros combined. On March, global real estate investment had generated 43.9 billion euros which is 70 per cent lower when compared to the March of 2019.
These figures seem undoubtedly dark. Yet the CEO of Colliers, Mikel Echavarren, argues that these figures will change in the second half of 2020: “This level of shock in world markets is unprecedented and we see a widespread effect worldwide, even in economies that have not been affected by the global financial crisis, such as China or Australia. The fall in global GDP is accompanied by other factors, such as global travel restrictions for commercial and tourist reasons, falling oil prices and volatility in the stock markets. The good news is that the recovery in each of them will be seen soon and the recovery is expected to be strong.”
The director of business intelligence in Colliers, Jorge Laguna, adds: “because of the changing nature of the Covid 19 crisis, it is hard to predict the immediate future of commercial asset transactions, but in Colliers we believe that there are reasons to be cautiously optimistic. To start with, governments and banks reacted much more quickly and on a larger scale than in the global financial crisis and, the weight of global capital is greater than it was ten years ago. We, as Colliers, predict that there will be a significant recovery in the second half after a short recession, however, it is based on a current forecast of a strong economic recovery in the second half and it should be noted that this requires caution.”