CRE Finance Sentiment is Finally Up After Almost a Year and a Half

Given the ongoing uncertainty, the sentiment gauge is still in the negative zone.

The quarterly sentiment index published by the CRE Finance Council shows a significant increase in Q4 2022. This marks the first sentiment increase since 2021.

The report, which includes balance sheet and securitized lenders, loan and bond investors, private equity companies, debt funds, servicers, and rating agencies, found that overall sentiment climbed to 68.6 last quarter. From 61.4 in the third quarter, which was the lowest level since the survey’s start in 2017. The jump represents an increase of 12%.

Despite progress in the right direction, the index is still in the negative due to the ongoing anxiety surrounding inflation, rising interest rates, and an impending recession, according to analysts with the CRE Financial Council. In addition, lenders and investors may have more difficulties in the upcoming year due to the uncertainties surrounding property valuation.Individual survey response rates were flat to somewhat better, with the biggest gains in the following areas: investor demand for assets, borrower demand for capital, and market liquidity in the CRE debt capital markets.

According to Raj Aidasani, Senior Director of Research at CREFC, members’ expectations for improved liquidity conditions increased by 18% in the fourth quarter of 2022. In Q3, 62% of respondents predicted a decrease in liquidity, while only 8% predicted an increase. However, in Q4, 18% predict better conditions while 47% predict a decline.In addition, the rising rate environment continues to weigh heavily, with 84% of respondents anticipating rates will have a negative impact on the industry in the current quarter, compared to 98% in the prior quarter, according to Aidasani.

The CREFC Board of Governors’ prediction for the Fed’s benchmark policy rate received a 5% median response when asked about it in the survey. 24% predict the rate will be higher than 5%, while 29% predict it will fall between 4.75% and 5.00%.
The SVN Vanguard team knows investors need an experienced commercial property management company by their side. Contact us for commercial properties for sale/lease.




San Diego Retail Property for lease
SVN Vanguard
San Diego commercial rental property
Orange County commercial office
100 W Broadway
Long Beach, CA 90802
License # 01840569
Phone Number
Fax Number
San Diego commercial real estate listings
San Diego commercial lease

©SVN Vanguard | LOS ANGELES| All SVN® Offices Independently Owned and Operated