Tips for Navigating the Buyer- Seller Disconnect

Commercial Real Estate Cap Rates Stable

•Yields holding firm since 2016 – Avg. CRE cap at 6.3% down from 8.2% at end of last recession

•Buyer-seller expectation gap still wide

Investors Have Opportunity to Capture Value

•Buyers sensitive to potential risk of maturing cycle and interest rate volatility

•Key Buyer Considerations: Keep eyes on the big picture. CRE yields higher than alternatives, and there’s still growth runway, a healthy demand outlook and opportunity for value creation

Long-Term Investment Strategies Key for Sellers

•Sellers benefiting from strong performance and economic momentum have less motivation to sell

•Key Seller Considerations: Think long-term on a portfolio level. Diversification, yield maximization and positioning for next cycle while liquidity elevated