In recent weeks, just as the deconfinement phases continue to progress in Europe and the United States, we have witnessed the recovery - even though still incomplete - in economic activity to the publication of several encouraging macroeconomic indicators. These indicators sometimes even go beyond analysts' expectations and support - in stages - a positive sentiment in the stock markets in particular, and the idea of a resumption of economic growth in a "V" shape.

CBRE reports that at the end of July 2020, the number of confidentiality agreements signed fell only 17% year-over-year - a marked improvement from the 74% drop in April and May 2020. This measure of The renewed investor interest could be a harbinger of a future rebound in the volume of commercial real estate transactions.

COVID-related health concerns and the potential for companies to more enthusiastically embrace remote work agreements have weakened the rental prospects of some office buildings. Operational office assets, such as life sciences facilities, data centers and single-tenant buildings, are more resilient to downturn risks and provide investors with income stability. The growing popularity of operational offices has boosted total transaction levels and led to an increase in materials in the average price per square foot of real estate sales.

Many investors are asking for price cuts, says CBRE. Property values ​​are expected to decline 10% to 20% by the end of the year, causing cap rates to rise moderately. While this trend did not fully manifest in Q2 2020 due to limited transaction activity, July sales indicate that the cap rates for Class A industrial and multi-family assets were more stable in Q2 compared to others. types of assets.

In this context, while it is natural that the activity data show strong signs of improvement, and should sometimes even break higher records, after having broken lower records, we maintain our central economic scenario, that of a gradual recovery over the coming quarters, supported by monetary and budgetary policies.

This recovery remains conditional on the gradual resolution of the health crisis.

But let's not forget that investors will still have to grapple with the harsh reality of quarterly corporate releases for Q2 2020 and uncertainty over the extent of the recovery. Thus, beyond these publications, which we already know will present a negative picture, the comments of companies on the current situation and the anticipation of managers as to the level of activity will be crucial. Finally, the example of not very encouraging health data recently in the United States, Latin America and even in some European countries confirms that the risk of a second wave of the COVID-19 epidemic cannot be completely excluded as long as a vaccine is not found and produced in large quantities.