NEW YORK CITY-ING Real Estate has issued a Global Vision report that predicts a continuation of the current healthy market for 12 to 24 more months. Economic growth, improving earnings and a continuing inflow of capital are all factors contributing to ING’s positive outlook; although, some markets will fare better than others.

“With commercial property yields relatively low, real estate investors are asking, ‘Is the party over?’” says Timothy Bellman, global head of research at ING Real Estate, in a statement. “Our answer is ‘no’ but there will be significant variations in performance by sector and by region. The global movement of capital is changing the nature of investment opportunities.”

Specifically continental Europe will see market improvements. The report cites Europe’s recovering economy, healthy market fundamentals and the possibility of a significant yield re-rating in the years ahead as indicators of the good months ahead. For example, England is slated to see moderate performance in both the industrial and the retail sectors; with the office and residential markets showing more growth potential.

“Because of increased transparency, liquidity and strong performance in recent years, real estate has emerged as a widely accepted asset class and, as a consequence, investors have increased their exposure to real estate,” says Maarten van der Spek, managing director of European research and strategy continental Europe. “With fundamentals generally healthy and improving, earnings growth should also continue to support steady income returns and we expect the strong capital inflow to continue.”

In the United States the office sector is expected to excel in the short term due to heavy demand and the lack of incoming supply. “It is the office sector’s turn to shine. Midtown Manhattan rents have risen by over 30% year-over-year and there is no shortage of demand for prime space,” says Indraneel Karlekar, head of research for ING Clarion Real Estate Securities. Other sectors including retail and industrial will stabilize but not grow, according to the report. A fall in consumer spending is likely to push that stabilization. Lastly, the apartment market will battle rising costs, increasing vacancy and the lack of demand.

ING executives could not be reached by deadline for further comment on the report they issued.

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