By: Sam Chandan, President & Chief Economist, Chandan Economics
Conditions are ripe for a shift in focus to commercial real estate’s secondary markets. Bolstered by the potential for more stable national economic trends, buyers’ improving tolerance for risk-taking, and a widening disparity in yields across primary and secondary markets, investors are broadening their sights.
Apart from their rankings on the commercial real estate investment hierarchy, secondary markets present investors with distinct opportunities and risks. As the economy expands and the distance from the financial crisis widens, understanding secondary markets’ performance patterns and their risk-return tradeoffs becomes an increasingly important task for investors, lenders and policymakers.