PGIM Real Estate’s Menifee on Capital Availability in 2018

At the 2017 ULI Fall Meeting in Los Angeles, PGIM Real Estate Head of Americas Investment Research Lee Menifee shared his 2018 outlook for the commercial real estate industry, including his perspective on debt and equity capital availability and the major asset classes.

At the 2017 ULI Fall Meeting in Los Angeles, PGIM Real Estate Head of Americas Investment Research Lee Menifee shared his 2018 outlook for the commercial real estate industry, including his perspective on debt and equity capital availability, and the major asset classes, as well as the risks to the continued recovery in this cycle.

“We’re really in a coordinated lower for longer environment,” Menifee said. “That means lower growth and lower returns on the downside, but that also means lower interest rates and fewer pressures that would really seem to disrupt things.”

He also noted that PGIM Real Estate’s forecast has changed over the last few months. Around the inauguration, the firm started to upgrade its forecast based on the expectation of strong near-term growth. “But over the last six months, we haven’t really seen those positive pressures build up.”

In terms of capital availability, both equity and debt flows into U.S. real estate remain strong, he noted.

For Menifee’s full forecast for 2018, check out the above video and subscribe to the CPE YouTube channel for more exclusive interviews!