Just when it looked like commercial real estate had put the impacts of the pandemic behind it and resumed a hot streak, broader political and macroeconomic conditions conspired to toss the sector back into uncertainty.
For commercial real estate 2022 started with promise. Almost every sector (with the notable exception of offices) began 2022 on strong footing. Fueled by strong property fundamentals and cheap credit, investment sales volume churned along at a record clip.
But as inflation kept creeping higher the Fed was forced to act and began an aggressive campaign to raise rates that proceeded throughout the second half of the year. Credit markets seized up and investment sales volume plummeted as dealmakers scurried to figure out how to reprice deals and fund purchases with less debt at a higher cost.
The uncertainty of the midterms and whether the Republicans would win back Congress along with Russia’s unprovoked war on Ukraine added to the volatility and contributed to higher global gas prices and supply chain disruptions.
As we enter 2022, the key word you hear throughout the industry is “uncertainty.” Will there be a recession? If so, how bad will it be? How high will the Fed push interest rates? Is inflation finally being tamed? Where will cap rates land when the dust is settled? Will there be a wave of distress caused by all of this or was the industry on better footing going into this uncertainty than before the Great Financial Crisis?
Answers to those questions will emerge in the next 12 months. For now, in the following gallery we highlight the top stories and topics that dominated our coverage in 2022.