With rate hikes put on hold and the fall in bond yields at the end of 2023, real estate market conditions and more specifically valuations, became easier to read. Hence, we expect a pick-up in investment activity in 2024 as the property risk premium has adjusted.
In 2024, the investment market will likely be driven by parties that are forced to sell assets due to new financing conditions or that are unable to inject sufficient capital to meet the latest environmental and/or technical standards. These forced sales will provide opportunities for equity-rich investors.
Increasing user expectations of environmental performance and quality of life at work are widening the gap between prime and secondary assets. Rents for next generation assets continue to rise, averaging +4.4% in the euro area in 2023, while rents for secondary assets, particularly in the periphery, are decreasing; a trend that is reinforced by incentive measures.
Real Estate Credit Investments Limited (LON:RECI) is a closed-end investment company that specialises in European real estate credit markets. Their primary objective is to provide attractive and stable returns to their shareholders, mainly in the form of quarterly dividends, by exposing them to a diversified portfolio of real estate credit investments.
