Earn the growth is the dominant theme arising from our view of the coming year. As suggested through the Base Case of the performance scenarios, modest economic growth will likely lead to more income-driven property-level appreciation. Without the added fuel of rapid economic expansion or increasing capital availability, investment performance will measure success in asset selection and property operations.
We look forward to 2013 with less attention on the credit crisis and recession of the recent past and concentrated focus on the challenges and opportunities ahead. Capital, although not free-flowing, is finding its way back to real estate assets. Transactions levels are near long-term average offering liquidity and flexibility to investors. The property sectors are at various points of fundamental improvement. Specifically, apartments are at peak performance, hotels have settled a bit and retail shows promise. Market pricing appears consistent with our Outlook, with continued premiums for high-quality income and value-add yields consistent with modest growth. We anticipate continued progression toward sustainable growth.
Source : UBS AG