BusinessGoldman Sachs Takes a Risk on US Property Market as Investors Brace...

Goldman Sachs Takes a Risk on US Property Market as Investors Brace for More Turbulence

Goldman Sachs poised to re-enter US <a href=real estate market, contrasting views from investors” id=”carouselImage” src=”https://i-invdn-com.investing.com/trkd-images/LYNXNPEK2C0IE_L.jpg”/> © Reuters. The emblem of Goldman Sachs is displayed on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., on July 13, 2021. REUTERS/Brendan McDermid/File Photo

Authored by Iain Withers

CANNES, France – After a period of decline in the U.S. commercial property sector, Goldman Sachs Asset Management is gearing up to dive back in with renewed interest. Despite growing concerns from other market participants, the head of real estate at Goldman Sachs Asset Management is optimistic about the market’s potential for recovery.

Due to factors such as rising interest rates and a surge in vacancy rates, property values in the U.S. have taken a hit, causing apprehension among investors. This shaky ground has caused alarm among regional banks heavily invested in the real estate market.

Market players convening at the MIPIM property conference highlighted the ongoing challenges faced by the office sector in the U.S. A senior executive from Brookfield Asset Management labeled the U.S. as “the most overstocked office market globally” and cautioned against excessive debt levels among investors.

However, Jim Garman, the real estate chief at GSAM, views the current situation as a chance for investments. He pointed to declining interest rates, a stabilizing market, and consistent buying interest as reasons for GSAM’s positive outlook.

Garman emphasized that GSAM has already started re-allocating capital towards real estate ventures in Europe and Japan and foresees a similar rebound in the U.S. market, albeit not without challenges.

Strengthening this sentiment, Schroders, the British fund management giant, is gearing up to capitalize on the U.S. real estate market by strategically expanding its presence and focusing on residential properties.

Throughout discussions at the Cannes panel, industry leaders noted a shift towards investing in logistics and data centers rather than traditional office spaces. This move reflects a broader trend within the commercial real estate sector toward sustainable and lucrative assets.

As concerns linger over the impact of declining property values on the financial sector, industry experts are closely monitoring the situation for potential repercussions if banks face significant losses on their property investments.

» …
rnrn

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Subscribe Today

GET EXCLUSIVE FULL ACCESS TO PREMIUM CONTENT

SUPPORT NONPROFIT JOURNALISM

EXPERT ANALYSIS OF AND EMERGING TRENDS IN CHILD WELFARE AND JUVENILE JUSTICE

TOPICAL VIDEO WEBINARS

Get unlimited access to our EXCLUSIVE Content and our archive of subscriber stories.

Exclusive content

Latest article

More article