Kevin Richards, partner and U.S. REIT leader at Deloitte, participated in a video interview during REITwise 2022: Nareit's Law, Accounting & Finance Conference held in Orlando, Florida on March 23-25.
Richards said that leadership “needs to shift the way they think about real estate and the way they think about growth opportunities in real estate.” He noted that real estate should be thought of as a service, using technology and data not just to deliver space but to deliver digital and physical services to tenants and end-users. That starts with smart buildings, he pointed out.
Meanwhile, Richards commented on the surge in foreign investment in U.S. real estate assets that occurred in 2021 and seems to have continued in the first quarter of 2022. He ascribed the gains to the “very positive view about the sector and the stable returns it can provide.”
At the same time, foreign investment has shifted to industrial and multifamily assets and away from office and retail, Richards said. A shift away from gateway markets to tertiary and secondary markets has also been evident.
Turning to the office sector, Richards said trends are positive, with each month producing stronger volume in terms of building entry swipes. Last year saw quarter-over-quarter leasing growth, “so that’s very positive,” he added.
Richards also said he believes the hybrid work model is here to stay. “Our real estate leadership need to make the office a place that people want to come,” he added.