The CRE Finance Council (CREFC) said its Fourth-Quarter 2022 CREFC Board of Governors (BOG) Sentiment Index represented the first upward movement after five consecutive quarterly declines. Overall sentiment increased to 68.6 in Q4, up 12% from 61.4 in the prior quarter, which marked the lowest level since the survey’s inception in Q4 2017.  

The BOG’s sentiment was flat to slightly upward in all nine questions. The questions with the most significant movements revolved around expectations for investor demand for CRE assets, borrower demand for financing, and liquidity in the CRE debt capital markets. Conversely, the outlook for all CRE finance businesses remained firmly in negative territory. 

“This most recent survey accurately captures the concerns of the industry at large at this time,” said CREFC executive director Lisa Pendergast. “While not a cause for celebration by any means, we hope this is the beginning of a positive streak.”  

She continued, “The reality remains that the Fed will continue to raise rates and the potential of an economic downturn still exists. We remain optimistic, however, that we are in a much better position and stronger place than we were in 2008.”