Most investment firms see US, Canadian RE deals fall through in wake of COVID-19
March 25, 2020 | Pam Rosacia | S&P Global Market Intelligence
A majority of the institutional real estate investment industry has seen property deals fall through in light of the coronavirus pandemic, according to a survey by the Pension Real Estate Association.
The survey conducted March 23-24 found that 67.3% of 165 respondents said their investment firms or organizations have seen real estate deals in the U.S. and Canada not finalized because of financial market volatility, or inability to travel or meet.
Based on 153 survey respondents, 73.9% said their investment firms or organizations have cut or temporarily suspended their plans to deploy capital into the North American real estate sector because of the current market conditions, while the rest have not scaled back their investment plans.
Asset managers are taking various initiatives in response to the pandemic and the related market volatility. Based on 140 responses representing property owners, investment firms or management firms, 86.4% said they have implemented enhanced cleaning or hygienic measures and 77.9% have held talks with tenants on rent abatement or forbearance. Of the respondents, 65.7% said they are delaying discretionary expenses to conserve cash and 32.1% are discussing debt payment forbearance with lenders.
Other steps implemented by asset managers are using virtual tours for leasing, closing amenities and increasing security, according to the survey, which received 202 responses overall.
Source: S&P Global Market Intelligence
