CRE Sentiment Index: Highest Since COVID-19 Pandemic Began
October 12, 2021
NAIOP's Sentiment Index is designed to predict general conditions in the commercial real estate industry over the next 12 months by asking industry professionals to predict conditions for their own projects and markets.
The NAIOP CRE Sentiment Index for Fall 2021 is 56, up slightly from April. This indicates that respondents expect conditions for commercial real estate to improve over the next 12 months.
The Index is higher than at any point since the COVID-19 pandemic began and has returned to the level observed in March 2019.
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- Survey respondents continue to expect most conditions to improve over the next year.
- Commercial real estate professionals expect construction costs to continue to rise, but they see the pace of material price inflation slowing.
- Respondents remain optimistic about general industry conditions next year.
- Overall, respondents remain optimistic about the future, but high levels of variation among their answers to individual questions suggest continued uncertainty.
- A large majority (62.7%) of respondents expect to be most active in projects or transactions related to industrial properties over the next year.