
Economic Recovery Underway - Some Headwinds Persist
•May retail sales are slightly down from April, but 18% above pre-pandemic levels; Core retail sales up 16%
•As more states reopen, signs point to a summer boost
•Labor shortages forcing restaurants, Hotels and Retailers to operate understaffed; driving wage & inflation pressure
Current Market Conditions Bolstering CRE Investor Demand
•Real estate’s rents and value tend to keep pace with rising costs, making it a good hedge against inflation
•High liquidity and low interest rates further fuel investor demand, particularly for Apt, Industrial and Self-Storage
•This lifts prices and puts downward pressure on cap rates
Sellers Can Ride Major Tailwinds, For Now
•Investors who sell will benefit from the wave of buyers and capital flooding into the sector
•Prime opportunity to take chips off the table, do a sale-lease back, or reposition to new market or property type
•However, the eventual market recalibration and potential rise in interest rates could limit this window of opportunity

Sources: Marcus & Millichap Research Services, U.S. Census Bureau