Cushman and Wakefield said 67 percent of real estate developers remain cautious of the prospects of the economy over the next 12 months.
A report on the results of the survey released by the property consultancy this month said developers “remain largely less optimistic as they expect capital values and rental rates to soften in the short-term.”
In the medium-term, developers expressed optimism the property market will show early signs of recovery along with moderate growth in capital values and rental rates.
But market vulnerability is seen to persist up to the mid-term.
“In the long-term or a period of two to three years, developers are very optimistic of the full recovery of the property market and expect the market will again build up momentum through a strong rebound of both supply and demand growth drivers. By then, the developers also expect a sharp recovery of capital values and rental rates,” the report said.
Industrial and office sub-sector remain a beacon of hope for the sector with 44 percent of the respondents expecting the office sub-sector to recover the fastest, as demand for business process activities are expected to grow post-pandemic period.
Fifty-five percent of the respondents have expressed no change in the project pipeline for industrial developments over the next 12 months and 61 percent expect demand for industrial space in the next 12 months will not be far from its pre-COVID levels.
The supply of new hotel and retail space is expected to fall significantly with half of development pipelines over the next 12 months indefinitely stalled.
The survey said 88 percent of hotel developers and 53 percent of retail developers expect revenue losses of greater than 50 percent in the next 12 months.