【CBRE】Eyeing Real Estate Returns Over a 10 Year Horizon

In all, we plotted 277 markets in quadrants that are defined by median capex-adjusted yield (vertical axis) and annualized 10-year NOI growth (horizontal axis). We forecast NOI growth based on expected changes in vacancy/availability rates and asking rent growth. When making our 10-year NOI forecasts, we place more emphasis on the first five years (70% weighting), when we have more confidence in our projections. The intersection of the quadrants represents the weighted average of all markets.

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