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he Zacks Real Estate Operations industry is navigating challenging times, with geopolitical instability and macroeconomic difficulties posing significant hurdles. Additionally, customers are prioritizing cost controls and delaying property purchase and leasing decisions for certain asset categories. Despite these obstacles, the industry is poised to benefit from growing demand for outsourced real estate services and emerging trends. Strategic investments in technology also provide a competitive edge.

    The Zacks Real Estate Operations industry encompasses companies offering various services, including leasing, property management, investment management, valuation, development, facility management, project management, transaction, and consulting services. However, REITs are excluded from this group. Economic trends and government policies significantly impact the real estate market, influencing factors such as economic activity, employment growth, interest rates, credit availability, tax policies, and regulatory environments.

    Geopolitical unrest is expected to have a profound impact on the industry's performance in 2025. Conflicts and wars in various countries have disrupted global supply chains, driven inflation, and influenced US policy changes. The uncertainty surrounding government policies in the United States will likely lead to significant disruption this year. Companies with international supply chains and diverse workforces may face complex challenges related to trade agreements, immigration policies, and diplomatic relations.

    In this environment, clients are expected to adopt a cautious approach, leading to delayed transaction closings as investors seek greater price discovery. The Federal Reserve's reduced interest rate cuts in the second half of 2024 will likely be fewer this year due to anticipated high inflation.