Three in four commercial real estate professionals believe that falling commercial real estate values will lead to increased investment in 2025, according to a new survey by TD Bank.
More than half of CRE investors (52%) believe future interest rate movement — specifically lowering rates — will have the largest effect on the sector, but just 14% expect that effect to come from changing policies and regulations of the new presidential administration, TD Bank said. The majority (70%) of respondents expect housing material prices to rise in 2025, but only 32% expect it to have an impact on investing in new developments.
TD Bank noted that increased confidence in the sector could also be driven by many U.S. companies implementing return-to-office policies, although many CRE professionals and investors are not expecting office work to match pre-Covid levels. Instead, more than two-thirds (68%) of respondents expect mixed-use properties will garner the most traction in 2025.