- Q2’s commercial real estate investment volume reached $85.7B, up 14% from Q1, though still 3% lower YoY.
- The CBRE Lending Momentum Index was up 4.3% in Q2, marking the first positive shift after five consecutive quarters of decline.
- Multifamily and industrial properties continue to dominate investment activity, making up the largest shares of single-asset investments.
Globest reported that in 2Q24, the U.S. CRE sector enjoyed 14% higher investment volumes compared to Q1, reaching $85.7B.
By The Numbers
Notably, Q1’s CRE investment volume was also 15% higher than in 4Q23, showing very consistent and steady growth for two quarters running.
But despite these gains, Q2 investment volume is still 3% lower YoY, reflecting ongoing market volatility. So, while the quarterly improvement is encouraging, the broader picture remains mixed.
The trailing four-quarter investment volume—a metric that smooths out short-term fluctuations—dropped 31.9% YoY, down to $341B from $500.2B. This is the lowest total since 2Q13, suggesting that while there are some positive signs, the market has not yet fully recovered.
Fortunately, after five quarters of decline, the CBRE Lending Momentum Index, which measures the pace of commercial loan closings, rose 4.3% in Q2. This improvement suggests a slight rebound in lending activity, though the index primarily reflects CBRE’s own loan closings, which may not fully represent national trends.
Moving The Needle
A significant portion of Q2’s investment activity was driven by a single transaction: Blackstone’s (BX) $10B acquisition of Apartment Income REIT. Without this deal, overall investment would have actually been down 9.3% from Q1 and down 14.4% YoY.
When examining single-asset investments, which totaled $60.6B in Q2, multifamily properties led the way with $22.5B (37.1% of the total), followed by industrial (23.1%), office (14.7%), retail (13.9%), and hotels (8.4%).
This sector-by-sector distribution remained relatively consistent with the previous year, indicating stabilizing investor preferences.
In Summary
The U.S. CRE market is gradually showing signs of recovery, with Q2 showing gains in both investment volume and lending activity. However, the overall market remains cautious, and further improvements will be needed to confirm a sustained turnaround.
