Capital Flows Continue Favoring Investment in Retail, Says Cox Castle’s Glick

Despite some continued headwinds in 2022, stemming primarily from supply chain issues, inflation and the continuation of the impacts of COVID-19, the retail real estate industry should have no shortage of capital as it continues the recovery that began in 2021, writes Cox, Castle & Nicholson’s Gary Glick. 

Investment activity in retail projects substantially increased in 2021 due to plentiful capital flows and strong demand from investors, notes Glick, a Los Angeles-based Cox Castle partner. “With equity capital targeting U.S. real estate near all-time highs and low-cost financing readily available, capital likely will continue to support investor demand for retail projects in 2022. “ 

Of note in 2021 was the growth in single-asset, single-borrower retail property transactions. “Many investors are still cautious about investing in shopping centers and prefer the security of evaluating a single property and sponsor (such as creditworthy tenants like Starbucks, McDonalds, In ‘N Out and Chick-fil-A),” according to Glick. 

Glick’s overview of retail capital market activity heading into 2022 is part of a Cox Castle forecast from the firm’s retail & commercial development group.