Has the commercial real estate market fully recovered from the pandemic?

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According to the report, about two-thirds of all REITs reported higher FFOs in the second quarter than a year ago. FFO of the retail sector rose for the fourth straight quarter in the second quarter, up 21.4% over the first quarter. By ownership type, regional shopping malls saw the largest increase in FFOs, up 32.5% quarter-on-quarter to $ 1.4 billion. Selected retail FFO ($ 806 million) and FF0 malls ($ 1.03 billion) were up 22.4% and 7.9% in the quarter.

Other sectors hit hard by the pandemic also saw income rebound. FFO hotel / resort REITs rose to $ 67 million in the second quarter after four consecutive quarters of negative FFO, while office REITs rose 37.7% to $ 2 billion, surpassing pre-pandemic highs. Diversified REITs reported a 20.8% increase in FFO to $ 575 million.

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“The real estate sectors supporting the digital economy have maintained their strong performance as the demand for technology trade and communications continued to grow even after the COVID-19 restrictions were lifted,” Nareith said in the report.

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