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16 May 20225 minute read

DLA Piper Global Real Estate Annual State of the Market Survey

Remarkable post-pandemic resurgence in commercial real estate is driving heightened optimism for the industry

With a few notable exceptions, the safety and travel restrictions put in place throughout the world at the start of the pandemic – now more than two years ago – have largely come to an end. And while life is seemingly returning to some semblance of normalcy, it’s impossible to ignore the fact that certain habits we once considered routine – like going to the office five days a week – could be permanently changed.

Pandemic-induced isolation, social distancing and restrictions on travel and gathering were particularly hard on the commercial real estate (CRE) industry. During the early days of the pandemic, narratives swirled that some commercial real estate asset classes were “dead” and that the “retail apocalypse” was nigh – but it didn’t turn out that way.1,2 Even those who are believers in the long-term durability of CRE as a global asset class probably would not have predicted that, at the start of 2022, media headlines would include things like, “2021 CRE Investments Hit Record $746B,” “Global Commercial Property Sales Rocket to Record in 2021,” and “Foreign Investment in U.S. Commercial Property Exceeds Pre-Pandemic Levels."3,4,5

DLA Piper’s 2022 Global Real Estate Annual State of the Market Survey shows not only a remarkable resurgence across the CRE sector, but also increased bullishness as leaders look to the future. While general bullishness remains roughly consistent with our 2021 report at 73 percent, more respondents in 2022 have a higher level of confidence for the real estate industry’s next 12 months. The increased optimism relative to 2020 – when just 21 percent expected a bull market – is significant.

Still, challenges remain, and concerns about the evolving impacts of factors such as inflation, rising interest rates and geopolitical conflict are top-of-mind for industry leaders. But, even in retail – the sector that is most directly influenced by consumer sentiment – pent-up demand and indicators like retail sales, foot traffic and store openings are giving leaders reasons for optimism, showing that brick-and-mortar retail remains an important component of retailers’ evolving omnichannel offerings.6,7,8

At the same time, the future of offices – and more importantly, where people work – is unresolved, with industry leaders predicting significant impacts brought about by reimagined office space, including the way real estate developers and investors think about retail and other commercial real estate near traditional business hubs.9 Even amid this uncertainty, office leasing activity has picked up. For example, in New York – though not surpassing the breakneck pace seen in the latter half of 2021 – occupancy rose 25 percent in the first three months of 2022, according to Newmark data.10 While leaders remain unsure whether office vacancies will ever drop to pre-pandemic rates, they do see an opportunity in repurposing some office spaces for hotel, multi-family residential and life science uses.

Driven in part by the fact that many workers are now untethered from their offices, we’re also seeing a marked redistribution of the population. Cities like Austin and Raleigh-Durham have seen an influx of new residents as they leave traditional hubs for smaller cities. As residents pivot, so do developers, landlords and investors. This shift is driving a staggering jump in sentiment supporting investment opportunity in these traditionally secondary markets, with Austin jumping from 22 percent in 2019 to 60 percent today. These new starlet cities aren’t as developed as New York, Los Angeles or Chicago, meaning developers can design real estate to meet the needs of today’s hybrid and remote workers.

Fielded during February and March 2022, our survey shows that ongoing uncertainty is not hindering the broader optimism about the future for commercial real estate. Respondents’ positivity was bolstered by the abundance of capital available to CRE, and this positive outlook remained an undertone throughout the trends anticipated to take shape in 2022. 

To read the full report, please download using the link at the top of the page.


1 “The Office Is Dead,” Medium, May 11, 2020

2 “The impending retail apocalypse,” Axios, July 6, 2020

3 “2021 CRE Investments Hit Record $746B,” GlobeSt., February 22, 2022

4 “Global Commercial Property Sales Rocket to Record in 2021,” Real Capital Analytics, February 4, 2022

5 “Foreign Investment in U.S. Commercial Property Exceeds Pre-Pandemic Levels,” The Wall Street Journal, February 8, 2022

6 “NRF Says 2021 Holiday Sales Grew 14.1 Percent to Record $886.7 Billion,” NRF, January 14, 2022

7 “Retail Foot Traffic Shows 'Significant Recovery' After Omicron Setback,” GlobeSt., March 10, 2022

8 “Coresight Bites: US Store Openings and Closures—2021 Review and 2022 Outlook,” Coresight Research, January 26, 2022

9 “The Worst of Both Worlds: Zooming From the Office,” The New York Times, November 16, 2021

10 “New York City’s Path to Recovery,” Newmark, April 2022