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US recovery expected Q2 2010

Foreign investors in real estate say a recovery could come within a year. A survey by AFIRE revealed that members expect 3x more debt investments and 7x more equity investments to be made in the second half of 2009 than for the whole year-to-date.

Foreign investors in US real estate expect a recovery in the property markets by the second quarter of 2010 – just one year away.

A survey by the Association of Foreign Investors in Real Estate (AFIRE) revealed that members believed the office sector would be the first to recover, followed by the multi-family and industrial sectors.

The results compare starkly to the thoughts of some US-based real estate investors, who recently warned delegates at the New York IMN conference to expect a long real estate recession. With real estate debt maturities set to peak between 2010 to 2012 and little sign that capital markets will have improved sufficiently to meet demand, some investors insist there is a “long way” to go until the industry reaches bottom.

This is the first mid-year survey conducted by AFIRE, which represents 200 real estate investors from 20 countries.

Respondents also said they expected to make significantly more investments during the remainder of 2009, than for the previous 12 months combined. Members said they expected to make three times more debt investments in the second half of 2009 compared to the past year, and seven times more equity investments.

More than 75 percent of those questioned hadn’t invested yet in 2009 – but around two-thirds planned to invest in debt or equity opportunities in the US before the end of the year.