On The Market

179: A “Year of Opportunity” to Come for Multifamily, Says CBRE’s Richard Barkham

Jan 15, 2024

CBRE's Richard Barkham discusses the state of the multifamily and commercial real estate market, including cap rate forecasts, why struggling multifamily investments didn't get foreclosed on, and the potential impact of oversupply. He also touches on the current macroeconomic climate, sector analysis, affordability, and the speculation of distress in the multifamily market.

49:08

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Richard Barkham

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Quick takeaways

The commercial real estate market, including multi-family properties, has shown resilience despite challenging economic conditions in 2023.

The office sector has experienced increased vacancy rates, while sectors like multi-family, industrial, and retail have remained relatively strong.

Deep dives

Overview of the Episode

In this podcast episode, host Dave Meyer interviews Richard Barkham, the executive director and global chief economist of CBRE, one of the largest commercial real estate companies in the world. Although the focus is on commercial real estate, the conversation explores parallels between residential and commercial markets. The episode provides insights into the state of the economy and how it impacts the commercial real estate sector. Richard discusses the performance of different sectors within commercial real estate, such as office, industrial, and retail. He also delves into trends in multi-family properties, including rental growth and vacancy rates. The episode concludes with a discussion on potential distress in commercial real estate and offers advice for real estate investors in 2024.

Introduction

2min

Virtual Summit and Interview with Richard Barkham

5min

The Impact of Macroeconomic Climate on Commercial Real Estate

3min

The State of Commercial Real Estate: Sector Analysis

17min

Affordability and Buying Activity in the Real Estate Market

4min

Distress in the Multifamily Market

16min

Building a Network and Taking Action in Multifamily Commercial

3min

Right now, many multifamily operators are scared. They’ve got debt due, higher vacancy rates than ever, and banks that could be coming for them at any second. And although a “soft landing” in the economy could help keep most multifamily operators from being foreclosed on—not everyone is safe. If you’re looking to invest in multifamily this year, there could be some big buying opportunities.

To walk us through the state of the multifamily and commercial real estate market is CBRE’s Richard Barkham. Richard leads a team of six hundred research experts, all digging into the most up-to-date real estate data around. Today, Richard touches on the commercial real estate space, why prices AREN’T crashing, the sectors that will continue to struggle in 2024, and why the industry as a whole has remained so resilient, especially when no one expected it to be.

We’ll also get into cap rate forecasts and how high they could get so prices finally come back down to earth. But that’s not all; Richard gives a rare take on why so many struggling multifamily investments DIDN’T get foreclosed on, whether or not the oversupply of multifamily could make trouble for residential buyers, and what will happen when the “wave” of multifamily construction hits.

In This Episode We Cover:

A 2024 commercial real estate update and whether or not a price crash is still on the table

Rising vacancy rates and the commercial sectors that could get hit the hardest

Cap rate expansion and whether or not we’ll see price cuts this year

Why Richard sees 2024 as a “year of opportunity” for multifamily investors

States with the most multifamily construction that could see price cuts spill over into residential

“Distressed” multifamily investors and why we WON’T see a wave of foreclosures

And So Much More!

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