– U.S. composite non-distress index in June 2021: 288 (350.0% higher than in 1996)
– U.S. composite non-distress index in June 1996: 64
– U.S. investment grade non-distress index in June 2021: 276 (338.1% higher than in 1996)
– U.S. investment grade non-distress index in June 1996: 63
In May, more than a year into the coronavirus pandemic, the Wall Street Journal reported that despite all the empty office buildings, vacant hotels, and ghost town shopping malls, the commercial real estate sector was doing surprisingly well. The foreclosure rate had barely changed, private equity firms and pension funds were spending record amounts of money on new buildings, and prices never fell anywhere near as far as they did in 2008.
Much of that, of course, can be credited to government coronavirus relief programs, but the virus arrived during one of history’s greatest economic runs, and that tide lifted real estate along with all the other boats. As Quantum Listing points out, 2019 signaled 120 months—a full decade—of uninterrupted economic expansion, the longest in the post-war era. That, along with the rise of tech, the rise of e-commerce, and soaring demand for multifamily homes, has made commercial real estate a red-hot ticket for investors nationwide.