Skip to Content (press ENTER)
North America
Investor Type
United States
Latin America
Asia Pacific
Investor Type
China (中国)
Investor Type
Hong Kong (香港 – 中文)
Investor Type
Hong Kong - English
Investor Type
Japan (日本)
Investor Type
Investor Type
Investor Type
Taiwan (台灣)
Investor Type
Investor Type
Real Estate

U.S. Real Estate: Positioned for Recovery

February 2024 – 10 min read

When considering the substantial correction in real estate prices and profound pull back in liquidity to this point, an inflection point in U.S. real estate appears closer than before. The Barings Real Estate team discusses how this backdrop is shaping opportunities across the asset class.

  • The fourth quarter of 2023 marked the sixth consecutive quarter of declining core real estate values, which are down 20.3% from the peak according to the NFI-ODCE.
  • While there is still plenty of uncertainty around the near-term path of inflation with repercussions for monetary policy, the stage is set for real estate transaction activity to re-engage positively at some point in 2024.
  • The probability of a U.S. recession has declined from 65% in June 2023 to 50% as of December 2023. Macroeconomic fundamentals have continued to be supportive of nominal rent trends across every property sector except for office.
Property Market
  • Real estate debt distress is rising. Unsurprisingly, office comprises the largest share of distressed debt but there are signs of strains in segments of the multifamily market.
  • Transaction activity totaled $90 billion in the fourth quarter of 2023, a 41% decline year-over-year. This marks the sixth consecutive quarter of falling transaction activity. For comparison, transaction activity fell for a total of seven quarters between 2007 and 2009.
  • Since the end of 2021, composite public REIT share prices have fallen by 44% with significant variation by property type.
  • The gap between public and private price trends suggests appraisal values have more to fall although the handful of transactions that are taking place are clearing at well below sellers’ book values.

Want to read the full article?

View PDF

Dags Chen, CFA

Head of U.S. Real Estate Research & Strategy

Lincoln Janes, CFA


Any forecasts in this material are based upon Barings opinion of the market at the date of preparation and are subject to change without notice, dependent upon many factors. Any prediction, projection or forecast is not necessarily indicative of the future or likely performance. Investment involves risk. The value of any investments and any income generated may go down as well as up and is not guaranteed by Barings or any other person. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.

Any investment results, portfolio compositions and or examples set forth in this material are provided for illustrative purposes only and are not indicative of any future investment results, future portfolio composition or investments. The composition, size of, and risks associated with an investment may differ substantially from any examples set forth in this material No representation is made that an investment will be profitable or will not incur losses. Where appropriate, changes in the currency exchange rates may affect the value of investments. Prospective investors should read the offering documents, if applicable, for the details and specific risk factors of any Fund/Strategy discussed in this material.

Barings is the brand name for the worldwide asset management and associated businesses of Barings LLC and its global affiliates. Barings Securities LLC, Barings (U.K.) Limited, Barings Global Advisers Limited, Barings Australia Pty Ltd, Barings Japan Limited, Baring Asset Management Limited, Baring International Investment Limited, Baring Fund Managers Limited, Baring International Fund Managers (Ireland) Limited, Baring Asset Management (Asia) Limited, Baring SICE (Taiwan) Limited, Baring Asset Management Switzerland Sarl, and Baring Asset Management Korea Limited each are affiliated financial service companies owned by Barings LLC (each, individually, an “Affiliate”).

NO OFFER: The material is for informational purposes only and is not an offer or solicitation for the purchase or sale of any financial instrument or service in any jurisdiction. The material herein was prepared without any consideration of the investment objectives, financial situation or particular needs of anyone who may receive it. This material is not, and must not be treated as, investment advice, an investment recommendation, investment research, or a recommendation about the suitability or appropriateness of any security, commodity, investment, or particular investment strategy, and must not be construed as a projection or prediction.

Unless otherwise mentioned, the views contained in this material are those of Barings. These views are made in good faith in relation to the facts known at the time of preparation and are subject to change without notice. Individual portfolio management teams may hold different views than the views expressed herein and may make different investment decisions for different clients. Parts of this material may be based on information received from sources we believe to be reliable. Although every effort is taken to ensure that the information contained in this material is accurate, Barings makes no representation or warranty, express or implied, regarding the accuracy, completeness or adequacy of the information.

Any service, security, investment or product outlined in this material may not be suitable for a prospective investor or available in their jurisdiction. Copyright in this material is owned by Barings. Information in this material may be used for your own personal use, but may not be altered, reproduced or distributed without Barings’ consent.

Contact Us to Learn More.


The form was successfully submitted.


Any data collected will be processed according to Barings’ Privacy Notice. You can unsubscribe at any time by clicking the link at the bottom of any promotional message we send, or by contacting us using the contact details set out in the Privacy Notice.


Related Viewpoints