Transcription
I'm a big believer in real estate. It's a great part of a portfolio, but it is a cyclical business. And post-COVID, when interest rates were taken up quite sharply, real estate went through a tough few years, adjusting to that.
Today, when you look, real estate is clearly in our minds, in my mind, in recovery phase. You can look also at the public REITs. The public REITs, having a good first half of the year, the strongest outperformance versus the S&P in 16 years. So we're seeing that positive recovery take hold.
Supply has come way down. Logistics, our biggest theme. New starts are down at, I think, a decade plus low. That's quite positive. Capital markets are better. More lending and spreads coming in. So more available capital and more affordable capital on that side. And the demand has held up. So good fundamentals.
Again, where you invest, again, matters. So it depends where you are and what sectors you're in. But logistics, we saw record leasing in our US portfolio in the fourth quarter. We saw, again, strong leasing in the first quarter here in the U.S. Data centers are obviously a bigger and bigger piece of our real estate business, very strong. Grocery anchored shopping centers, strong. The hotel business, luxury had been strong, but even now more broadly in the hotel space. Nice to see it all coming back, yeah.
So yes, to me, real estate is a place that you wanna be invested in. You particularly wanna be investing in these recovery phases, and you can feel that, you know. Getting the vintage right, really important. For sure.