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Commercial real estate outlook

Q2 2022: A strong market put to the test

Today’s backdrop poses challenges for investors, but we believe areas of opportunity remain across CRE sectors.

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April 13, 2022 | 15 minute read

Any prospect of the world returning to a more normal environment in 2022 was quickly put to rest in the first three months of the year. Soaring inflation, a new COVID variant, the outbreak of war in Ukraine and hawkish monetary policy gripped the global economy in Q1. Risky assets wavered while interest rates rose. Still, the U.S. economy appears to be in a strong place, buttressed by a healthy consumer and stellar corporate profits. Within the U.S. commercial real estate (CRE) market, we see a debate emerging around high valuations and the ability of strong fundamentals to support them amid rising risks.

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Any projections, forecasts and estimates contained herein are based upon certain assumptions that the author considers reasonable. Projections are necessarily speculative in nature, and it can be expected that some or all of the assumptions underlying the projections will not materialize or will vary significantly from actual results. The inclusion of projections herein should not be regarded as a representation or guarantee regarding the reliability, accuracy or completeness of the information contained herein, and neither FS Investments nor the author are under any obligation to update or keep current such information.

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Andrew Korz, CFA

Executive Director, Investment Research
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Christopher Bole

Financial Writer, Fund Communications
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Robert Hoffman, CFA

Managing Director, Credit Wealth Solutions
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