The Real Estate Roundtable's quarterly Sentiment Index dipped slightly during the first quarter of 2015. The index, a survey of real estate executives, measures current, as well as future, confidence in the financial and real estate markets.
"On the one hand, conditions for commercial real estate are quite good — and getting better — driven by improved job growth across the economy, improved business demand, and strong capital flows, as well as appropriate levels of construction and lending in key sectors," said Jeffrey DeBoer, president and chief executive officer of the roundtable, in a release. He also expressed relief over the passage of the Terrorism Risk Insurance Act by Congress last month.
However, "1Q survey participants expressed concern about global instability, rising terrorist and cyber threats, falling oil prices, potential future erosion of underwriting standards, and what one respondent called 'unprecedented attacks' on businesses through pending labor regulations," said DeBoer.
A rise in interest rates would also concern the survey participants, which cited the unlikely scenario of the Federal Reserve raising rates without stronger employment.
The overall index stood at 68 during the first quarter of 2015, with the current index at 72 (although down two points from the previous quarter) and the future index at 64. The eight-point spread between the two measures is the widest in the five-year history of this survey, the roundtable said.
