Significant increases in input prices have been a particular challenge for 90% of real estate executives overall and 96% of construction executives specifically. In response, real estate executives are being forced to either slow down planned development activities or take matters into their own hands, diversifying their supplier base to increase resilience while seeking to strengthen critical supply relationships.
We also believe that the urgency to adjust operations and supply chains is pushing real estate executives to buy established platforms and capabilities rather than building from within. Nearly one-fourth (22%) say they’ll be putting most of their M&A focus on increasing operational capabilities.
Looking ahead, creative investment strategies will dominate the agenda
As real estate executives continue to navigate the uncertainty that is likely to prevail throughout 2022, we expect the focus to be on creative investment strategies that enable them to remain resilient. This could include ongoing investment interest in nontraditional property types as well as platform and people expansions.
Whatever forms their investments take, real estate executives will remain vigilant and disciplined in the execution of their strategy.
Joanna Acosta and Meg Quinn contributed to this article.