If the latest impact survey from NAIOP is an indication, the recovery will be a bifurcated one. The organization conducts routine surveys to assess market activity during the pandemic, and the most recent shows investors continue to be weary about the market conditions. Investment activity has improved for resilient asset classes, but others continue to struggle amid the ongoing pandemic.

The survey asks investors to assess recent investment activity. Industrial was the clear winner, with participants responding that there has been stronger deal activity and new development than in both September and August, the previous two surveys. Activity in office and multifamily, however, has slowed. Investors responded seeing fewer existing asset transactions and new construction deals than in September for both asset classes, and more respondents said they saw no new deal activity in the two asset classes. In retail, fewer respondents reported no new deal activity, and there was an increase in deal flow for both existing assets and new construction and redevelopment deals.

With rent collection, there was reason to be more optimistic. Most respondents reported that at least 90% of tenants had paid rent in full and on time. While office, industrial and retail all had improving rent collections compared to the previous survey in September, multifamily collections have faltered from that time. Fewer respondents reported full rent collections above 90%, and more respondents reported that fewer than 50% of tenants had paid rent in full and on time.

While there was some drop for multifamily in terms of on-time collections, survey respondents in all asset categories said that fewer tenants asked for relief or rent assistance. Retail and office showed the most notable improvements in this category.

Looking ahead, the survey also asked how long the coronavirus pandemic is likely to impact business operations. Most participants forecasted challenges for the next 6 to 12 months, an increase from the September survey for this category. Nearly 20% of respondents also forecasted operational challenges for the next 18 months, also an increase from September. This shows continued uncertainty about the pandemic and its ongoing impact on the market.

Mixed investor sentiment has become characteristic of the current market. The Allen Matkins/ UCLA Anderson Forecast biannual commercial real estate survey showed that investors are optimistic on multifamily and industrial product, but pessimistic on the future of retail and office.

However, as the NAIOP survey reflects, retail sentiment is improving. In a recent interview, Gary Glick of Cox, Castle and Nicholson says that the announcement of two vaccines helped to fuel consumer spending at the end of the year, and gave investors a renewed confidence in the eventual recovery of retail.