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JLL Sees “First-Mover Advantage” in Global Refinancing Gap
An estimated $3.1 trillion of commercial real estate assets globally will have maturing debt by the end of 2025, according to JLL’s Global Capital Outlook research. The current refinancing shortfall for these loan maturities is an estimated $270-$570 billion, which will catalyze provide a clear advantage for investors ready to move forward in 2024, says JLL.
Currently, there’s a total of $402 billion in dry powder for commercial real estate sitting on the sidelines. However, a clearer picture is already emerging as global CRE sees a growing number of bidders re-enter the market, according to JLL’s proprietary Bid Intensity Index. This movement is being driven particularly by activity from private investors and select institutional capital; the U.S. is furthest along in its price adjustment cycle, followed by Europe and Asia Pacific.
“This reset in values will both challenge capital and catalyze liquidity,” said Richard Bloxam, CEO, capital markets at JLL. “There is absolutely uniform understanding that pricing has changed. Given the quantum of dry powder, there will be a considerable first-mover advantage for capital that can deploy quickly and mobilize around opportunities as market fundamentals improve.”
- ◦Financing
