Why is now the perfect time?
In early 2020, the pandemic suspended consumer spending and consumption, shut down the world both nationally and internationally and disrupted supply chains and logistics everywhere. As the world slowly starts to get back to normal, we are seeing the ramifications of the pandemic. As consumers come back to the market looking to purchase items, they are finding scarce inventory and in many cases products not being available. The products that are available are becoming more expensive and prices are rising because of the lack of supply. Moving forward these things will eventually be resolved and in the meantime interest rates will remain low to help fend off rising inflation.
As investors in real estate these are two indicators to watch closely. The investment real estate market has a surplus of capital from both debt and equity sources, whom are eagerly searching for opportunities to be put to work.
Short supply of available investment opportunities continues to be a challenge, exaggerated by investors narrowed focus on quality and asset classes resistant to COVID, such as industrial and Fast Casual Restaurants. Risk of inflation has led more investors to put importance on annual rent escalation clauses and tenant balance sheets than in the past. However, as capital continues to compete, look for investors continue to push back into all asset classes as the onset of inflation creates incentives to borrow now and pay back later.
