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Transaction activity at decade low, but renewed momentum emerging

Global Real Estate Perspective February 2024

Interest rates and capital costs remain elevated, causing bid-ask spreads in commercial real estate markets to persist and contributing to the decline in transaction volumes. Direct investment declined globally during Q4, down 23% year-over-year to US$166 billion. This brought full-year 2023 volumes to US$594 billion, reflecting a decrease of 44% compared to 2022 and the lowest level of direct investment in over a decade. Fundraising for closed-end funds trended similarly, decreasing by 28% against 2022 to US$142 billion in full-year 2023.

This article is part of JLL’s Global Real Estate Perspective

While all major sectors experienced declines in 2024, the outlooks across the major property sectors in the short- and long-term remain mixed. Pricing and liquidity for office assets are under pressure, amid weak global sentiment from investors and lenders. Asset performance is highly polarized, and the recovery and growth in office fundamentals will be driven by best-in-class assets. However, sentiment for logistics, living and select alternative growth sectors remains positive despite volumes declining globally, as markets in the sector have repriced quickly. The living sector was the most active throughout the year and will be a beneficiary of sector diversification globally.

Global Real Estate Perspective February 2024

This page is part of JLL’s quarterly Global Real Estate Perspective. Follow one of the links below to find out more about global real estate market trends and outlook by sector.

Investment

Transaction activity at decade low, but renewed momentum emerging

Investment

Office

Signs of gradual recovery in demand

Office

Retail

Increasing competition for quality retail space

Retail

Logistics

Logistics activity stabilizing

Logistics

Hotels

Urban hotel performance accelerating

Hotels

Living

Rising activity in emerging living markets

Living

Global Office Market Dynamics

The latest global office market dynamics

Global Office Market Dynamics

Summary

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Summary