RICS reports gradual recovery in commercial real estate sentiment

The headline RICS Commercial Property Sentiment Index (CPSI) has turned less negative for the second successive quarter.

The report revealed improvements in feedback is visible both in the occupier and investment markets.

The headline RICS Global CPSI for Q1 2024 stands at -10, which represents the least downbeat reading since Q2 2022.

Significantly, the less negative tone across the aggregate results is shown on both on the occupier and investor sides of the market.

As far as the former is concerned, the Occupier Sentiment Index (OSI) improved from -13 to -8 while the Investment Sentiment Index (ISI) moved from -18 to -13.

Additionally, over three-quarters of respondents indicate they have seen some increase in the repurposing of office space for other uses.

The index reveals that excess office space after the pandemic and the resulting shift in work practices has triggered an increase in repurposing across the Americas, APAC and Europe.

In terms of office tenants downsizing, to reflect greater use of hybrid working, just over half of contributors pointed to an increasing incidence of this over the past year.

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