CBRE, a global leader in commercial real estate services and investment, released its annual market outlook report titled “U.S. Real Estate Market Outlook 2022,” in which it projects steady demand for new real estate in the country.

CBRE Real Estate Market Outlook 2022

CBRE divides its market outlook into six segments which include:

• Office Occupier
• Retail
• Industrial & Logistics
• Multifamily
• Hotels
• Data Centers

We Covered this in our Weekly Wire Roundup

Office Occupier

• 53 million sq. ft. of new office construction
• The busiest downtown office markets are Austin and Miami 
• Markets like Manhattan, Los Angeles, San Francisco, and Washington, D.C. experience lower rents compared to other downtown areas

Retail

Per CBRE’s assessment, retail development will remain constrained due to developers focusing on multifamily and industrial development projects.

Industrial & Logistics

A trend toward leasing more distribution and logistics space to eliminate transport costs. Transport costs are much higher compared to rents.

The top concern for occupiers in 2022 will be rising transportation costs and supply chain delays. The cost to ship goods via ocean freight increased more than 200% in 2021 and the cost for domestic freight increased over 40%.

CBRE

Multifamily

CBRE forecasts “multifamily occupancy levels to remain above 95% for the foreseeable future and nearly 7% growth in effective net rents next year.”

CBRE further projects “an 8% growth in effective urban rents in 2022. These exceptional growth rates will moderate to 3% in 2023 and slightly below that in subsequent years.“

Hotels

CBRE projects “an 8% growth in effective urban rents in 2022. These exceptional growth rates will moderate to 3% in 2023 and slightly below that in subsequent years.“

Data Centers

5G, AI, and edge computing will drive the need to have more industrial-scale spaces to rent for the company.

Investment Volumes in Real Estate Soars Back

The report by CBRE observes that real estate investment volume will go up just as there was an upward investment trend in 2021.

Total investment volume in 2022 is projected to increase 5%-10% over 2021 levels, which are on track to equal pre-pandemic volumes from 2019 (currently the highest annual total on record). Although, industrial and multifamily assets will continue to capture the most investor interest given the tailwinds of e-commerce and demographic shifts, investment in office and retail should also pick up.

CBRE | 2022 U.S. Markter Outlook

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