2021 House View: North America Property Market Outlook


Will McIntosh, Ph.D
Global Head of Research

John Kirk, CAIA, CCIM
Senior Director, Research

Mark Fitzgerald, CFA, CAIA
Executive Director, Research

Karen Martinus
Senior Associate, Research

Jay Johnston
Senior Associate, Research



December 2020

Executive Summary

We are pleased to present our 2021 Annual House View for North America. This publication is typically produced biannually and serves two essential purposes. First, it highlights our outlook for the economy, the capital markets, and the commercial real estate (CRE) sector. Secondly, it provides a forward-looking framework regarding our investment themes and strategies. This year we deferred our mid-year House View, given the pandemic’s status at that time, and elected to produce this document at year-end 2020. The following includes several highlights from the report:

  1. The COVID-19 pandemic has taken a significant toll on the economy and will continue to shape the pace of recovery in 2021. A high degree of uncertainty surrounds the outlook, and we are continuing to monitor the potential for downside risks and upside surprises.
  2. Early indications suggest the recovery will be uneven across the U.S. Both the fiscal and monetary response will heavily influence the pace of the recovery once a vaccine is widely available.
  3. Price discovery for real estate properties is still emerging. Distress conditions will be unevenly distributed. Some property types (e.g., logistics) will enjoy enhanced performance while others (such as retail) will experience more disruption.
  4. The pandemic has fueled specific themes that we believe will emerge in the “new economy” – including the intersection of technology and real estate as well as rental housing.
  5. The combination of record stimulus and continuation of low interest rates has pushed bond yields to their lower bounds and set the stage for continuing increased allocations to real estate.