M&A Explorer | Companies with exposure to commercial real estate in particular—including banks—could be prime targets for bankruptcy-related deals in the US

The real estate sector is looking ahead with more optimism, as interest rates peak and a clearer picture forms on valuation and future financial performance

Real estate has historically shown resilience during challenging economic periods and is considered a reliable hedge against inflation—but not all assets are created equal, and dealmakers were highly selective in the transactions they pursued in 2022

The sector's ability to adapt to changing circumstances underlines positivity and upbeat sentiment about the future—particularly in the longer term

US deal activity saw an annual decrease in H1 of this year, but remains buoyant compared to pre-pandemic standards

Red-hot demand for warehouse space drove dealmaking in the sector in H1

After dropping in 2020, real estate M&A ramped up significantly in 2021

M&A value among real estate firms quadrupled year-on-year in H1, after a tough 2020

Investors are finding businesses showing resilience

The number of distressed and liquidation-related M&A deals, especially in the US and UK, has increased year on year as businesses struggle to adapt to their post-pandemic reality.

Signs of a rebound follow last year's pullback in private equity real estate deals

Real estate portfolios exposed to hospitality and retail assets have struggled through COVID-19 lockdown periods, but healthcare and logistics investments have performed strongly

Hospitality and dining have been buffeted by the pandemic, weighing on deal activity. But Q4 has brought welcome refinancing support and investor confidence.