The retirement funds are cooling on the sector and limiting new investments in the sector, the Wall Street Journal reported. The shift comes after they poured money into commercial real estate during the first half of the year, capitalizing on a market trying to recover from the wreckage of the pandemic.
Retirement funds made $32.6 billion in commitments to commercial properties in the first half of the year, according to Ferguson Partners, up 40 percent year-over-year. It’s too soon to put a number on what the second half will bring, but activity in the sector is highly influenced by interest rates, which have been subject to recent hikes in the Federal Reserve’s moves to tamp down inflation.
Photo by Andreea Ch