The low interest rate environment supports asset values and fuels demand, although the research and interviews conducted in July and August 2020 revealed a sense of suspended animation with two key drivers.
The first is the COVID-19 pandemic itself, which has put economies on pause. Analysts are understandably cautious about when normality might resume and how it might look when it does. Accelerated trends, changes in demand and newly desired outcomes means the landscape could be harder than ever to navigate. The survey shows a marked decline in business confidence for 2021, with almost half of all respondents expecting a fall in profits.
The second is the government response. Governments across the world have introduced mitigation measures, such as tax and insolvency deferrals, to stave off the worst effects of the pandemic and in some cases even instigating deferrals or moratoriums on rent collection. And, in the United Kingdom (UK), whilst the government has committed to “build, build, build”, details of the programme are yet to be published.