Nuveen eyes opportunities in ‘brown discounts’ for old buildings
The office real estate head of US investment giant Nuveen says the growing split in value between high-quality, environmentally performing offices and older, dirtier building stock will lead to a “brown discount” that creates opportunities for new investors willing to invest in substantial upgrades.
The increasing “bifurcation”, or division between newer and older office towers will allow net returns in “mid-teens” percentages for investors renovating the latter, but lower-grade building prices need to fall further to justify the hefty investment needed, Nuveen managing director Chad Phillips said.
Subscribe to gift this article
Gift 5 articles to anyone you choose each month when you subscribe.
Subscribe nowAlready a subscriber?
Introducing your Newsfeed
Follow the topics, people and companies that matter to you.
Find out moreRead More
Latest In Commercial
Fetching latest articles