Fathom’s Chart of the Day 22.04.2020: Tracking the impact of COVID-19 on commercial property values

Understandably, some commercial property values have been hit hard by the emergence of COVID-19. While industrial REITs have outperformed the global equity market, office and retail REITs have underperformed substantially. High Street retailers have, of course, been under threat from online stores for a number of years. Although the severe restrictions currently in place may cause some bricks-and-mortar retailers to fail earlier than they might have done otherwise, it is hard to see that it will have a sizeable impact on the long-term outlook for that sector. The same cannot be said of the market for office space, in our view. In recent weeks, many office workers around the world will have learned that they can operate reasonably effectively from home.

It is possible that the COVID-19 pandemic will have an enduring impact on the demand for office space, and consequently on its price. The relative performance of different types of commercial property is something to watch as we learn more about the long-term consequences of the disease.

Refresh this chart in your browser | Edit the chart in Datastream

This chart is taken from Fathom’s Recession Watch newsletter. Click here to subscribe to Recession Watch and receive invitations to Fathom’s regular Recession Watch Forums and participate in lively discussions with our team and others in the community.

Next forum date: Monday 4 May 2020, 3:00pm BST

__________________________________________________________________________________

Datastream

Financial time series database which allows you to identify and examine trends, generate and test ideas and develop view points on the market.

Refinitiv offers the world’s most comprehensive historical database for numerical macroeconomic and cross-asset financial data which started in the 1950s and has grown into an indispensable resource for financial professionals. Find out more.