53 Real Estate and Rental and Leasing in The US Industry Report

US INDUSTRY (NAICS) REPORT 53
Real Estate and Rental and Leasing in the US

Home sweet home: Sector performance is expected to weaken, with revenue rising
slowly
John Madigan | November 2020
IBISWorld.com +1-800-330-3772 info@IBISWorld.com

Real Estate and Rental and Leasing in the US 53 November 2020
Contents
About This Industry...........................................5 Competitive Landscape...................................27
Industry Definition..........................................................5 Market Share Concentration....................................... 27

Major Players................................................................. 5 Key Success Factors................................................... 27
Main Activities................................................................5 Cost Structure Benchmarks........................................ 27
Supply Chain...................................................................6 Basis of Competition................................................... 31
Similar Industries........................................................... 6 Barriers to Entry........................................................... 32
Related International Industries....................................6 Industry Globalization..................................................32
Industry at a Glance.......................................... 7 Major Companies............................................ 34
Executive Summary....................................................... 9 Major Players............................................................... 34
Industry Performance..................................... 10 Operating Conditions...................................... 39
Key External Drivers.....................................................10 Capital Intensity........................................................... 39

Current Performance................................................... 11 Technology And Systems........................................... 39
Revenue Volatility........................................................ 40
Industry Outlook............................................. 16 Regulation & Policy...................................................... 41
Industry Assistance..................................................... 42
Outlook......................................................................... 16
Performance Outlook Data......................................... 18 Key Statistics.................................................. 43
Industry Life Cycle....................................................... 18
Industry Data................................................................43
Products and Markets..................................... 20 Annual Change.............................................................43
Key Ratios.................................................................... 43
Supply Chain................................................................ 20
Products and Services.................................................20 Additional Resources...................................... 44
Demand Determinants................................................ 22
Major Markets..............................................................23 Additional Resources.................................................. 44
International Trade.......................................................24 Industry Jargon............................................................ 44
Business Locations..................................................... 24 Glossary Terms............................................................44
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Covid-19
Coronavirus IBISWorld's analysts constantly monitor the industry impacts of current events in
real-time – here is an update of how this industry is likely to be impacted as a result
Impact Update of the global COVID-19 pandemic:
· The method in which operators in the Real Estate and Rental and Leasing sector
conduct their business has been disrupted by the outbreak of COVID-19
(coronavirus). Due to mandated social distancing and the limitations imposed on
gathering size, many showings and open house events have been canceled. If
sector operators cannot rent inventory, sector revenue is expected to decline.
· The real estate subsector is expected to experience stiff headwinds as a result of

the coronavirus outbreak. Due to the forced shuttering of businesses and rising
unemployment, residential and nonresidential renters alike do not have the cash
flow to afford rent and other debt obligations. Failure to pay will likely result in
evictions and foreclosure, greatly weakening sector performance due to a decline in
overall demand.
· The rental of equipment may be buoyed as capital expenditures are trimmed by

downstream operators and industrial operators as they opt to rent machinery as
needed, instead of outright purchasing equipment.
Note: The content in this report is currently being updated to reflect the trends
outlined above.
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About This Industry

Industry Definition This sector is primarily concerned with operators involved in the management, sale,
purchase and rent of real estate. This sector also includes the renting and leasing
of tangible goods, such as equipment, and intangible goods, such as patents. It is
important to note that operators which are primarily engaged in renting or leasing
equipment with operators are excluded from this sector, as well as commercial
mortgages, which are treated as a financial instrument.
Major Players United Rentals Inc.
Realogy Holdings Corp.
CBRE Group Inc.
Avis Budget Group Inc.
Main Activities The primary activities of this industry:

Renting and leasing of tangible assets (i.e. equipment)
Renting and leasing of intangible assets (i.e. patents)
Managing, renting, selling, buying real estate
The major products and services in this industry:

Real estate
Rental and leasing
Lessors of nonfinancial intangible assets
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Supply Chain
SIMILAR INDUSTRIES
Real Estate Investment Apartment Rental in the US Real Estate Appraisal in the Truck Rental in the US
Trusts in the US US
RELATED INTERNATIONAL INDUSTRIES
None
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Industry at a Glance
Key Statistics Key External Drivers % = 2015-2020 Annual Growth
$1.0tr 2.8%
Per capita disposable income
2.2%
Value of residential construction
Revenue
-1.3% 3.1%
Annual Growth Annual Growth Annual Growth Yield on 10-year Treasury note Homeownership rate
2015-2020 2020-2025 2015-2025 -0.4%

Rental vacancy rates
2.0% 0.6%
Industry Structure
$490.4bn POSITIVE IMPACT

Profit
Annual Growth Annual Growth Revenue Volatility Concentration

Low Low
2015-2020 2015-2025
Globalization
2.4% Low
47.6% MIXED IMPACT

Profit Margin
Life Cycle Regulation
Annual Growth Annual Growth Mature Medium
2015-2020 2015-2025
Technology Change Competition
Medium Medium
0.9%
NEGATIVE IMPACT
3m Capital Intensity Industry Assistance
Businesses
High Low
Annual Growth Annual Growth Annual Growth
Barriers to Entry
2015-2020 2020-2025 2015-2025
Low
2.6% 1.7%
Key Trends
5m Economic fundamentals underpinning sector growth are not

in sync
Employment
Amid rising unemployment, private listers, consumers and
Annual Growth Annual Growth Annual Growth businesses alike are experiencing a liquidity crisis
2015-2020 2020-2025 2015-2025 As a result of strong rent growth, the subsector showed
strong performance
2.0% 1.0%
Sector profitability is expected to take a dip over the next five
years as weak conditions persist
$181.3bn Amid a wave of evictions and a drying up of cashflow,

landlords could also lose their property
Wages
General softening in the residential real estate market is
Annual Growth Annual Growth Annual Growth expected to weaken operating conditions
2015-2020 2020-2025 2015-2025
Current sector performance and profit have been strong due
to a confluence of positive trends
1.9% 1.0%
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Products & Services Segmentation
68.5% 24.5% 7.0%
Real estate Rental and leasing Lessors of nonfinancial

intangible assets
Real Estate and Rental and Leasing
Source: IBISWorld
Major Players % = share of industry revenue SWOT
STRENGTHS
High Profit vs. Sector Average
WEAKNESSES
Low Revenue per Employee
High Capital Requirements
High Customer Class Concentration
High Product/Service Concentration
OPPORTUNITIES
High Revenue Growth (2015-2020)
High Revenue Growth (2020-2025)
High Performance Drivers
THREATS
Low Revenue Growth (2005-2020)
Low Outlier Growth
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Executive Over the five years to 2020, the Real Estate and Rental and Leasing
Summary sector in the United States has performed well, with sector revenue
increasing an annualized 2.0% to reach $1.0 trillion, which includes
an expected decline of 1.8% in 2020 alone amid softening rents.
Additionally, this subsector's performance has been aided by an increase in housing
starts, which have increased an annualized 2.3% during the period. Performance in
the lessors of real estate industry group has also been supported by falling
vacancy, but also stymied by a slight uptick in homeownership, likely a
consequence of record low interest rates.
Moreover, as residential and nonresidential construction activity increases, so does

demand for construction machinery and equipment, which has supported growth in
the Rental and Leasing Services subsector via the commercial and industrial
machinery and equipment rental and leasing industry group. Additionally, as per
capita disposable incomes continue to rise and more US citizens increase domestic
travel, growth in the Rental and Leasing Services subsector has also been
supported by rising revenue in the automotive, consumer and general goods rental
and leasing industry group. Overall, current sector performance and profit have
been strong due to a confluence of positive trends. However, with the outbreak of
COVID-19 (coronavirus), the future of the sector is uncertain, with concerns about
financing, foreclosure and bankruptcy roiling real estate and rental markets and
slashing construction market activity in 2020 alone.
Over the five years to 2025, sector performance is expected to weaken, with sector
revenue rising at a decelerated, annualized 0.6% to reach just under $1.1 trillion by
2025. Sector revenue is expected to slow mainly due to a reversal of current real
estate market conditions. Rent growth is expected to soften, as vacancy is
expected to rise and the homeownership rate is anticipated to increase an, which
will serve to weaken demand for the lessors of real estate industry group, and
subsequently the Apartment Rental industry (IBISWorld report 53111). Overall,
sector performance will be dictated by how employment and price growth are
affected by the outbreak of coronavirus, depending on the level of foreclosure and
bankruptcy exhibited over the next few years as a result of the coronavirus
outbreak.
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Industry Performance
Key External Rental vacancy rates

Drivers The rental vacancy rate can be used as a metric for supply and demand of
residential real estate available for rent. As vacancy declines, supply of rental units
becomes tight, permitting landlords to charge higher rents, increasing sector
revenue. The rental vacancy rate is expected to fall in 2020.
Value of residential construction

The value of residential construction represents the value of all new work
performed, alterations, maintenance and repairs on residential structures in the
United States. As the value of residential construction increases, it indicates rising
demand for residential real estate, driving revenue gains for the sector. Additionally,
as construction activity increases, there will be renewed demand for construction
equipment rentals, further boosting sector revenue. The value of residential
construction is expected to rise in 2020.
Homeownership rate
The homeownership rate demonstrates the share of consumers who own homes.
As homeownership rises, demand for rental housing is expected to fall, weakening
industry performance. Conversely, as homeownership falls, demand for rental
housing will rise, boosting the industry's performance. Homeownership rates are
expected to rise in 2020, posing a potential threat to the industry.
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Per capita disposable income

Per capita disposable income can be used as a metric of affordability. As per capita
disposable income increases, consumers will be able to better afford sector
products, such as apartments and homes for rent, boosting sector demand. Per
capita disposable income is expected to rise in 2020.
Yield on 10-year Treasury note

The yield on the 10-year Treasury note is indicative of the federal government's cost
of borrowing. As the yield increases, borrowing costs also increase. Interest rates
on conventional mortgages and on leases will move in line with the yield on the 10-
year Treasury note. As interest rates rise, the cost of borrowing also increases,
which will push up sector revenue as long as cost increases do not stifle demand by
pricing consumers out of the market. The yield on the 10-year Treasury note is
expected to fall in 2020, presenting the industry with a potential opportunity.
Current It is important to consider the effect of the global outbreak of

Performance COVID-19 (coronavirus) in early 2020 on Real Estate and Rental and
Leasing sector performance.
It is necessary to understand that the sector was marked by initial strong
performance over the five years to 2020, and a deceleration after 2018. Overall,
fueled by strong activity in both the residential and commercial real estate industry
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groups and rising residential construction activity, the Real Estate and Rental and
Leasing sector is expected to post an annualized 2.0% increase in revenue to reach
$1.0 trillion, which includes an expected decline of 1.8% in 2020 alone as demand
and rents weaken.
Fundamentals are not so fun
Overall, the largest concerns this sector experiences are in regard to

the macroeconomic fundamentals, which underpin growth.
According to the Federal Reserve Bank of St. Louis, home and commercial property
prices have recovered over 100.0% of their pre-recessionary value in some markets.
However, it must be noted that the sector has been showing marked signs of
structural weakness during the period, including an oversupply of luxury housing
units, declining rent affordability across metro-areas and an operating environment
characterized by debt-fueled acquisitions and high financial leverage.
This has created market distortions which help to explain the rapid rise in the real
commercial and residential estate subsegment of this sector over the past 10
years. In fact, according to Bloomberg, in 2016, the Federal Reserve warned “[real
estate] appear[s] increasingly vulnerable to negative shocks, as…prices have
continued to outpace rental income.” To be clear, the residential and commercial
real estate leasing subsegment of this sector has been overheating, posturing itself
for a deceleration, due to a looming affordability crisis, despite strong results
currently exhibited. However, the coronavirus outbreak has served to invert these
results, putting further financial stress on landlords. In fact, according to CNN, rents
have fallen in some metro-areas between the 10.0% and 20.0% range in the first half
of 2020, which has muted industry performance, with high-end and luxury units
expected to take the largest hit. This is of particular concern for intuitional investors
or private property owners who rent out real estate via platforms such as Airbnb,
since they will be hit with a lower volume of rental transactions as well falling rental
income for the units they can manage to rent.
Notably, it must be considered how much real growth the sector has exhibited, and
how much growth can be considered nominal, and thus a consequence of inflation
and market distortions. Due to rent growth outpacing wage growth, it is clear that
economic fundamentals underpinning sector growth are not in sync. With nominal
home values rising faster than their real value and the buying power of real wages,
causing the wedge between real and nominal value to grow, more and more
consumers are boxed out of affordable markets. This has been further aggravated
via rising unemployment as a result of the COVID-19 (coronavirus) outbreak.
Although declining rents for luxury units during the first half of 2020 may serve to
ease this constraint, so many individuals out of work and unable to pay rent make it
unlikely that rents will soften to the point of affordability in an undersupplied
middle-market, since cash-strapped renters will be seeking something that meets
their current income levels.
This has been further exacerbated by the presence of record low interest and
mortgage rates, which has incentivized the rapid purchasing of properties to rent on
borrowed funds, which increases the financial risk and leverage of operating in the
sector. So long as rental payments from tenants were coming in, landlords and
property developers could keep ahead of their debt payments with current
operating revenue. However, with the outbreak of coronavirus and millions of US
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citizens and businesses out of work and forcibly shut down, potentially unable to
meet their rental and other financial obligations, the sector is headed for deflation
at best, or a financial crisis at worst. Moreover, with legally mandated forbearances
for 180 days giving unemployed renters some relief, cash flows for landlords have
all but halted, pinching them between lack of current operating revenue and the
need to service debt obligations. Moreover, this has been further exacerbated by
weakening rents in June 2020, which has increased the financial burden on
landlords, further stressing the operating environment. According to the most
recent Q3 Special Report authored by ATTOM Data Solutions, at least 15% of
mortgagees were underwater in Q2 of 2020, in 37 of the nation's top 50 most
distressed housing markets, with 13% of national mortgages being underwater.
Overall, according to the report “foreclosures will be concentrated in markets where
there is a dual trigger – for example high unemployment rates and homeowners
who are underwater on their loans.” Lastly ATTOM projects that the United States
will exhibit anywhere between 225,000 and 600,000 foreclosures through the end of
2021, which spells a problem for the industry since foreclosed homes return no
rent.
Overall, this has started the clock for the sector, and it is now a race against time to
for unemployed renters to recover lost wages and get back to work to make their
rent and mortgage payments, with some states and institutions requiring a lump
sum payment of lost rent at the end of the forbearance period, which will shift the
debt burden onto already cash-strapped renters. Overall, there is a reckoning
coming due for the sector once the forbearance period ends. Undoubtedly, the Real
Estate and Rental and Leasing sector has not undergone such turmoil since the
subprime mortgage crisis and much about future sector performance remains
uncertain.
Cash crunch looming
During the current period, commercial and residential real estate

performance has been strong, with rising residential and
commercial rents, particularly the office and apartment rental
subsegments, supporting revenue growth.
Low interest rates have enticed commercial and industrial customers alike to lease
more warehousing and logistics space, while companies such as WeWork have
been taking advantage of low rates to acquire more office space. Moreover,
companies such as Airbnb in the residential leasing segment, have been performing
strongly as a result of increased domestic and international travel and rising
residential rents, with property owners using low interest rates to fuel the
acquisition of more properties to rent out via the company's online platform.
Overall, the commercial and residential leasing segments of this industry have had
a strong period, fueled by strong macroeconomic conditions and low interest rates,
though performance has been showing signs of weakness, with an affordability
crisis expected to cause a slowdown.
With the outbreak of coronavirus, it is abundantly clear that the sector is headed for
a downturn of some degree. Amid the mandated social distancing and
telecommuting of nonessential workforce, a massive slowdown in domestic and
international travel, declines in consumer spending and consumer confidence,
companies such as WeWork and private listers renting residential property via
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Airbnb's online platform are enduring a massive deadfall in demand, slashing

revenue expectations, which are falling faster than expected due to softening rents
in the first half of 2020. In fact, sector participants such as the Hertz Corporation
(Hertz) have contended with such a deadfall in demand that they have had to file for
Chapter 11 bankruptcy. It should be noted that Hertz had billions in debt ready to
mature in 2020, which it would be unable to meet due to the stiff operating losses
recorded in the first two quarters of the year, thus forcing them to file for Chapter
11.
Additionally, amid rising unemployment and the forced closure of businesses

nationwide, private listers, consumers and businesses alike are experiencing a
liquidity crisis, potentially unable to pay their own financial obligations. As the
fallout from coronavirus unfolds, it is expected that the sector will exhibit a wave of
foreclosures, evictions and bankruptcies amid overleveraged landlords and cash-
strapped renters, in addition to an overall deflation of the sector as a whole, which
has been evidenced by softening rents. However, it must be noted that this
downturn could serve as a strong opportunity for participants or new entrants that
have balance sheets in better repair, though the outcome of this remains to be
seen.
Luxury markets weigh on affordable rents
A potent combination of oversupply and under-demand has set the

sector up for a difficult challenge, with the conditions that provided
for such strong growth early during the period weakening the
industry in the latter half of the period and finally hammered by
coronavirus with weakening rents disrupting cashflows.
Inexpensive debt and rising rents have enabled a rapid expansion in luxury
residential unit supply. However, due to increases in rents outpacing affordability
and wages, most luxury units are sitting on the market, causing a supply crunch in
the middle-market segment, which has experienced explosive rent growth and
priced most consumers out of the market. According to data from the New York
University Furman Center, half of low-income households in 53 survey areas are
considered severely rent-burdened, meaning they pay over 50.0% of their income to
rent, a disparity that is rising due to the impacts of coronavirus.
However, as a result of strong rent growth, the subsector showed strong

performance, exhibiting increases in revenue, profitability and participation. Sector
profitability, measured as earnings before interest and taxes, has risen to reach
47.6% of revenue in 2020, though it should be made apparent that this is a decline
from higher levels observed during the period. During the period, the number of
industry enterprises has risen an annualized 2.6% to reach 3.3 million operators.
Moreover, with participation rising, the number of industry employment has risen an
annualized 2.0% to reach 5.2 million workers.
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Historical Performance Data

Year Revenue IVA Estab. Enterprises Employment Exports Imports Wages Domestic Rental
Demand Vacancy
Rate
($m) ($m) (Units) (Units) (Units) ($m) ($m) ($m) ($m) (%)
2011 775,451 649,596 2,687,449 2,608,752 4,263,406 N/A N/A 143,226 N/A 9.52
2012 811,662 685,097 2,739,682 2,659,940 4,330,587 N/A N/A 148,588 N/A 8.68
2013 848,243 695,927 2,805,815 2,724,779 4,420,387 N/A N/A 149,659 N/A 8.32
2014 889,859 746,041 2,910,867 2,826,557 4,565,163 N/A N/A 156,954 N/A 7.55
2015 935,013 778,270 3,013,382 2,927,152 4,701,207 N/A N/A 164,902 N/A 7.05
2016 967,743 804,920 3,068,528 2,978,086 4,789,446 N/A N/A 168,145 N/A 6.85
2017 998,011 827,470 3,191,321 3,090,863 4,932,759 N/A N/A 172,774 N/A 7.18
2018 1,025,259 856,798 3,294,258 3,190,974 5,085,899 N/A N/A 178,077 N/A 6.88
2019 1,049,455 885,913 3,383,749 3,278,318 5,211,525 N/A N/A 182,436 N/A 6.75
2020 1,030,208 867,511 3,421,150 3,320,874 5,193,650 N/A N/A 181,266 N/A 6.65
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Industry Outlook
Outlook Over the five years to 2025, the Real Estate and Rental and Leasing
sector is expected to decelerate, largely as a result of expected
slowdowns in the Real Estate subsector caused by increases in the
rental vacancy rate and the homeownership rate.
Demand for equipment and
automotive leasing and rentals is
expected to support the sector amid
a weakening of Real Estate
subsector, as low auto rates and
currently low fuel prices are
expected to stimulate auto leases,
once consumers begin to recover
income and begin to travel and
spend again. However, it is important
to consider how long the adversity of
the COVID-19 (coronavirus) outbreak
will hang around, disrupting
fundamental wage growth due to
such high slack in current labor
markets, which could cause the
sector to slide further due to the fact
that income levels for some
consumers may not have recovered to the point where they plan to rent property. As
a result, the sector is expected to post marginal growth, with revenue rising a
meager, annualized 0.6% to just under $1.1 trillion by 2025.
Sector profitability is expected to take a dip over the next five years as weak
conditions persist, potentially aggravated by the coronavirus outbreak. Furthermore,
along these lines, increases in industry participation are expected to slow, along
with increases in employment. Due to overall weakness, the number of sector
operators is expected to increase at a decelerated annualized rate of 1.7% to reach
3.6 million companies, while the number of industry employees is expected rise a
meager annualized 1.0% to reach 5.5 million workers.
Déjà vu with a twist
Overall, similar effects were experienced in the aftermath of the

2008 subprime mortgage crisis.
Amid rising foreclosures and evictions, consumers who used to own a home found
themselves renting or moving in with family since their income could no longer
support mortgage payments due to skyrocketing unemployment. This actually
boosted sector performance due to a spike in rental housing demand from
foreclosed homeowners. Whereas rental and leasing of apartments was a
benefactor during the prior recession, this time around, they are expected to take
the brunt of the hit since it is now consumers who are delinquent on rent payments,
not institutional investors unable to cover their liabilities due to toxic mortgages.
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To be clear, there is an affordability crisis looming on top of the already wide

disparity between wage growth and rent growth. Now, renters are expected to be
evicted in waves after the 180-day forbearance period expires (extended, and they
must pay back-rent. If they cannot, it is likely these renters will be evicted,
increasing vacancy and depressing rent growth, ultimately weakening subsector
performance due to a massive deadfall in demand as a result of suppressed
income and inability to pay lump sum back-rent. Moreover, this could trickle into a
financial crisis, should landlords of these properties have significant debt or
financial obligations they had been servicing via rental income. Amid a wave of
evictions and a drying up of cashflow, landlords could also lose their property due
to repossession as a result default. This would serve to limit rental supply and
further price renters out of affordable markets since rents would be expected to
rise amid a dearth of supply. Furthermore, the issue of low supply has been
compounded by stark declines in residential building activity as a result of the
coronavirus outbreak in 2020. Though rising rents due to limited supply may aid
landlords, it will certainly limit demand, weakening the sector as a whole. Last time
around, foreclosed homeowners could fall back on rental property. Now, it is
unclear where evicted renters will fall back, greatly exacerbating potential weakness
in this subsector. In this current pandemic, asset values cannot simply be inflated to
fix balance sheets via quantitative easing, as it is individual renters and landlords
who will be in distress, not institutional investors.
Effects of COVID-19
This general softening in the residential real estate market is

expected to weaken conditions for the Real Estate and Rental and
Leasing sector, causing sector revenue to contract over the next five
years.
This decline is likely to be exacerbated by the coronavirus outbreak. Overall, there is
a reckoning coming for this subsector, in that once the 180-day forbearance period
is up, consumers will contend with large, lump sum bills in some cases to pay back-
rent. If renters do not return to work within this time period and make up for lost
income, it is likely that evictions will spike, exacerbating already expected increases
in rental vacancy, leaving industry landlords unpaid and in a vulnerable financial
position. Overall revenue in this segment is expected to decline as a result of rising
vacancy, potentially exacerbated by evictions due to coronavirus, and an overall
decline in rents since rising vacancy will restrain landlords' pricing power. Lastly,
some sector landlords could be forced to close operations due to lack of payment
to their financial creditors, severely weakening the sector moving forward.
Moreover, despite potential extensions of the forbearance period, this would only
increase the size of the lump-sum payments, a strategy that is the policy equivalent
to kicking the can down the road. Eventually, the bill will come due, setting the
subsector up for a massive cash crunch.
However, it should also be noted that this could potentially be an opportunity for
those who have balance sheets in stronger repair. Consumers who retain their jobs
during the downturn are likely to be spending less on discretionary items and saving
more in case the economy should take a greater turn for the worse. Overall, a
devaluation of home prices and a reduction in rents, in combination with record low
interest and mortgage rates, could entice some new entrants into the industry,
using the downturn as a buying opportunity for new property to rent out. However,
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this remains to be seen in the immediate aftermath of coronavirus in the second

quarter, and potentially in the third and fourth quarters of 2020 alone.
Rental and leasing services contend with headwinds
Over the five years to 2025, the Rental and Leasing subsector is
expected to recover somewhat after a miserable 2020.
Companies such as the Hertz Corporation (Hertz), Avis Budget Group Inc. and
United Rentals Inc. have all exhibited strong declines in revenue in 2020 alone due
to the deadfall in demand stemming from the coronavirus outbreak. Hertz has been
so negatively affected that they have been forced to file for Chapter 11 bankruptcy.
However, those companies that do survive the downturn are expected to come back
to life once consumers begin traveling, renting cars and as construction markets
roar back to life, increasing demand for rented construction equipment. Barring a
tough performance in 2020, this subsector may exhibit higher growth over the next
five years due to limitations in capital spending and a desire to keep balance sheets
lean. Therefore, as construction activity resumes, operators may be more inclined
to rent equipment due to the fact that cashflows may be unsteady and renting is a
way to keep operating costs down by lowering deprecation charges.
Performance Outlook Data

Demand Vacancy
Rate
2020 1,030,208 867,511 3,421,150 3,320,874 5,193,650 N/A N/A 181,266 N/A 6.65
2021 1,015,411 839,498 3,460,568 3,364,844 5,185,131 N/A N/A 180,508 N/A 6.96
2022 1,029,172 844,869 3,531,393 3,435,324 5,267,653 N/A N/A 183,295 N/A 7.22
2023 1,026,092 834,408 3,575,833 3,482,192 5,288,805 N/A N/A 183,774 N/A 7.44
2024 1,051,102 854,693 3,658,223 3,562,283 5,405,712 N/A N/A 187,920 N/A 7.64
2025 1,061,628 860,380 3,716,175 3,620,378 5,469,637 N/A N/A 190,074 N/A 7.81
Industry Life Cycle The life cycle stage of this industry is Mature
LIFE CYCLE REASONS

Significant rise in enterprise and establishment numbers
Stable product markets
Medium level of technological change
Established end market
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The Real Estate and Rental and Leasing sector is considered to be in the mature
stage of its life cycle. Sector value added (SVA), which is a measure of the sector's
contribution to the overall economy, is expected to rise an annualized 1.0% over the
10 years to 2025. In contrast, US gross domestic product (GDP) is expected to rise
an annualized 1.9% during the same period. Although SVA is growing more slowly
than US GDP, this sector is still in the mature phase of its life cycle. First, SVA is a
proxy measure for GDP that is computed using sector profitability, depreciation and
wages as a share of revenue. During the period, the sector's share of wages over
revenue has remained essentially unchanged and while sector profitability has
weakened slightly, it is still quite stable. Additionally, sector depreciation remains
consistently between 16.0% and 20.0% of revenue. Due to the relative stability of
these components, it can be inferred that this sector is mature, with SVA growth
largely keeping pace with US GDP growth. It is expected that SVA is slowing during
the latter half of the period due to a hot residential real estate market, with vacancy
increasing in more recent years. Other indicators, such as the stable entry of
enterprises and establishments, well-defined end markets and limited opportunity
to technologically innovate serve to further demonstrate that this sector is in the
mature phase of its life cycle. During the next 10-year period, barring any
unforeseen market distortions, SVA growth should trend more in line with US GDP
growth as the sector normalizes. Moreover, this weakness in SVA also stems from
expected weakness in sector performance during the outlook period as a result of
the COVID-19 (coronavirus) outbreak.
19 IBISWorld.com
Products and Markets

Supply Chain KEY BUYING INDUSTRIES KEY SELLING INDUSTRIES
1st Tier 1st Tier
Mining in the US Home Builders in the US
Retail Trade in the US Apartment & Condominium Construction
in the US
Healthcare and Social Assistance in the
US Housing Developers in the US
Finance and Insurance in the US Industrial Building Construction in the US
Manufacturing in the US Commercial Building Construction in the
US
Consumers in the US
Accommodation and Food Services in the
US
2nd Tier
Construction Machinery Manufacturing in
Public Administration in the US the US
SUV & Light Truck Manufacturing in the
US
Woodworking Machinery Manufacturing
in the US
Products and
Services
The Real Estate and Rental and Leasing sector is composed of three
subsectors, the Real Estate subsector, the Rental and Leasing
Services subsector and the Lessors of Nonfinancial Intangible
Assets (except copyrighted works) subsector.
20 IBISWorld.com
The following is a description of each subsector, its products and the subsector's
disposition of total sector revenue.
Real Estate (NAICS 531)
The Real Estate subsector accounts for the majority of sector

revenue, accounting for a diminished 68.5% of total sector revenue
in 2020.
This subsector has taken a hit in 2020 as a result of the COVID-19 (coronavirus)
outbreak, however it is expected to remain the dominant contributor to sector
revenue. This subsector includes enterprises and establishments primarily engaged
in the renting or leasing of real estate to others, as well as those engaged in the
selling, buying or renting of real estate for others. Moreover, this subsector includes
equity real estate investment trusts (REITs) primarily engaged in the leasing of
residential buildings or other property to others. Mortgage REITS are excluded from
this subsector since they are considered a financial instrument. The Real Estate
subsector has performed quite well over the five years to 2020. Most notably, the
Apartment Rental industry (IBISWorld report 53111) has supported growth in this
segment, posting an annualized 2.6% increase in industry revenue during the
current period. Additionally, this subsector's performance has been aided by strong
revenue gains in the Real Estate Sales and Brokerages industry (IBISWorld report
53121), which exhibited strong results as well during the period. Overall, this
subsector is expected to remain the largest contributor to sector revenue over the
five years to 2025.
Notably, this subsector is likely the most exposed to effects from the coronavirus
outbreak, since home showings, apartment showings and essentially all other
nonvirtual methods of showcasing living spaces have been stymied due to social
distancing mandates. In May 2020, some states are reopening their economies and
are imposing strict rules on showings, such as only two adults being present, and
no open house events. Realtors are only permitted to conduct showings by
appointment, and all parties present must adhere to social distancing rules and
wear a face covering. Overall, there might be some life breathed into the subsector
in the remainder of 2020 and early into 2021, should some consumers retain their
jobs and income. However, according to Zillow, home prices, and rents by
extension, are expected to decline nearly 5.0% between now and 2021, which will
put a damper on any rents or sales, although these trends could prevent a bigger
slide.
Rental and Leasing Services (NAICS 532)
The Rental and Leasing Services subsector accounts for a rising

24.5% of sector revenue in 2020.
This subsector includes enterprises and establishments that provide a wide variety
of tangible goods such as automobiles, computers, consumer goods and industrial
machinery and equipment to consumers for a rental fee or lease payment.
Establishments in this subsector can be further broken down into locations
engaged in renting consumer goods and equipment and those that are engaged in
renting or leasing machinery and equipment. This subsector excludes
establishments engaged in leasing in conjunction with loans, and are classified
21 IBISWorld.com
under the Finance and Insurance sector (NAICS 52). Essentially, any service
engagement that includes the rental of equipment and a specialized operator to use
the equipment (e.g. crop harvesting services) is excluded from this subsector. This
subsector's performance has been supported by activity in the Car Rental industry
(IBISWorld report 53211) and the Heavy Equipment Rental industry (IBISWorld
report 53241).
This subsector had a relatively strong performance in line with the sector as a
whole, fueled by rising levels of tourism and international and domestic travel.
However, with massive reductions in travel and fuel costs in 2020, this segment is
expected to take a hit. Moreover, major players such as Avis Budget Group Inc. are
anticipated to post stark declines in revenue for 2020 as a result of coronavirus,
with competitor the Hertz Corporation being forced to file for Chapter 11
bankruptcy.
Lessors of Nonfinancial Intangible Assets (except copyrighted works)

(NAICS 533)
The Lessors of Nonfinancial Intangible Assets (except copyrighted

works) subsector is expected to account for the smallest share of
sector revenue, accounting for an increased 7.0% of total sector
revenue.
This subsector includes establishments engaged in the assigning of rights to
assets such as patents, trademarks, brand names or franchising agreements, for
which a royalty or fee is paid to the asset holder. It should be noted that
establishments in this subsector own the patents, trademarks or franchise licenses,
which they permit others to use or recreate for a fee. Establishments leasing
tangible assets are classified under the Rental and Leasing Services subsector
(NAICS 532). Along these lines, the Intellectual Property Licensing industry
(IBISWorld report 53311) has supported this segment.
Demand Demand for Real Estate and Rental and Leasing sector products and
Determinants services is first and foremost influenced by consumer affordability,
measured by per capita disposable income or median household
income.
As income levels rise, consumers will be better able to afford sector products and
services. Conversely, when incomes fall, consumers will be less able to afford
certain residential options, forcing them to relocate and weakening demand for
sector products and services.
Demand for sector residential real estate industry group is typically dependent on
levels of employment as well. If consumers do not have income, they cannot afford
to rent an apartment or a home. Particularly in 2020, with surging unemployment as
a result of the COVID-19 (coronavirus) outbreak, it is expected the industry will
exhibit a deadfall in demand.
22 IBISWorld.com
The homeownership rate will also determine demand for sector products and
services. Technically, conventional mortgages are treated as financial instruments
and are not included in this sector. However, rates of homeownership will indirectly
determine levels of demand for this industry. As more consumers seek to own their
homes, demand for residential rental services will decline.
Interest rates will also affect levels of demand for sector products and services. As
interest rates rise, depreciable assets such as automobiles and construction
equipment will become more expensive to lease or rent, due to increased capital
cost. However, record low interest rates in 2020 and mortgage rates could suppress
sector activity, if consumers have retained the necessary income to take advantage
of falling home prices and inexpensive financing options.
Moreover, levels of demand for products and services can be linked to levels of
construction activity. When construction activity and other industrial activities are
booming, demand for the rental and lease of heavy equipment and machinery will
rise. In 2020, construction activity has been slashed a result of coronavirus, which
has put a damper on demand from this particular subset.
Lastly, demand for sector products and services can be linked to time spent on
leisure and sports in addition to levels of domestic and international travel. As more
consumers travel domestically, demand for automobile rental and leasing will also
rise.
Major Markets
Real Estate and Rental and Leasing sector major markets can be broken down into
the household and consumer customer segment (65.5%) and the business and
industry segment (34.5%). The majority of sector revenue comes from consumer
and household markets, as they are often the ones most engaged in the Real Estate
subsector. Individuals, consumers and households will demand residential real
estate and the necessary services it requires. Business and industrial demand will
largely support the Rental and Leasing subsector. To control capital costs,
construction companies will often lease or rent equipment on an as needed basis.
Additionally, the rental or lease of automobiles or other consumer goods is often
conducted on an as needed basis as well, which limits the overall significance of
this subsector's contribution to total sector revenue. Overall, the Real Estate
23 IBISWorld.com
subsector supports a large volume of high-value transactions, thus necessitating

that the majority of sector revenue is earned by consumers and individuals in this
subsector.
Overall, the outbreak of COVID-19 (coronavirus) is likely to push down the consumer
and household segment due to an overall suppression of income in addition to a
stark rise in unemployment. Overall, it is expected that the consumer segment will
take a dip in line with other industry segments, but this could reflect a proportional
increase in the share of business and industry customers. However, it is expected
that consumers and households will recover as unemployment recedes and
consumers are put back to work.
International Exports in this industry are Low and Steady

Trade
Imports in this industry are Low and Steady
As a service-based sector with physical products being namely land and property,
the Real Estate and Rental and Leasing sector does not record international trade.
Ultimately, there is no exchange of goods across international borders. Information
concerning multinational companies or major players that have foreign operations
can be found in the Globalization section of this report.
24 IBISWorld.com
Business
Locations Business Concentration in the United States
WA
MT ME
ND
VT
OR MN
NH
ID WI
SD NY MA
WY MI CT RI
IA PA
NV NJ
NE
OH MD
IL IN DC DE
UT
CO WV VA
KS MO
CA KY
NC
AZ TN
OK
NM SC
AR
AL GA
MS
TX LA
FL
AK
HI
Percentage of Establishments (%)
0 5 10 15
Real Estate and Rental and Leasing in the US

Source: IBISWorld
The distribution of Real Estate and Rental and Leasing sector establishments most
closely follows the distribution of the nation's population. Often, sector
establishments will be concentrated in population-dense urban areas that are short
on space. Additionally, sector establishments tend to concentrate in these areas
due to high levels of construction activity, which increase demand for rental and
leasing services for construction and heavy machinery. The Southeast is the most
concentrated region of sector activity, accounting for an estimated 25.7% of sector
establishments. The next-most concentrated region of sector activity is the West,
which accounts for 20.5% of sector establishments. Following this, the Mid-Atlantic
region accounts for 15.4% of sector establishments. Lastly, the Great Lakes region
accounts for 10.7% and the Southwest accounts for 11.9%. No other region
accounts for more than 10.0% of sector establishments.
Notably, the COVID-19 (coronavirus) outbreak may serve to shift the composition of
industry operations to a degree. As more consumers flee crowded cities in the wake
of the coronavirus, it is likely that the concentration of industry landlords may shift
to more suburban areas, though cities are still expected to hold the dominant
position over the five years to 2025.
25 IBISWorld.com
26 IBISWorld.com
Competitive Landscape
Market Share Concentration in this industry is Low
Concentration
The Real Estate and Rental and Leasing
sector exhibits a low level of market share
concentration, with the top four major
players accounting for less than a
combined 5.0% of sector revenue. Overall,
this sector has an extremely high number
of nonemploying establishments, which
account for 87.5% of total sector
establishments and 43.1% of sector
revenue. Therefore, it is difficult for anyone
one company or group of companies to
control a significant portion of the sector's
market share. Moreover, subsequent
industry groups also exhibit low levels of
market share concentration, firmly
cementing this sector in the low-level
concentration category. Due to this sector's inordinate proportion of nonemploying
enterprises, it is not expected that market share concentration will shift
dramatically over the five years to 2025. Moreover, it is unlikely that the outbreak of
COVID-19 (coronavirus) will serve to shift industry concentration either, due to the
fact that the industry is so diffuse.
Key Success IBISWorld identifies 250 Key Success Factors for a business. The most important for this
Factors industry are:
Having a good reputation: Operators in the sector must maintain cordial relations with
renters and leasers to ensure repeat business.
Having marketing expertise: Operators that do not pay attention to market signals can
miss out on opportunities by not adjusting rents accordingly.
Carrying out all necessary maintenance to keep facilities in good condition: It is

necessary for lessors to upkeep property, buildings and inventory to ensure customer
satisfaction.
Business expertise of operators: Lessors that are not savvy will miss out on potential
growth opportunities.
Ability to carry out credit checks on clients: Lessors must carry out their due diligence
to ensure potential clients can afford rental payments over the proceeding term of the lease.
Having a clear market position: Lessors with an identifiable market position or brand
name will be more widely recognized and trusted by consumers.
27 IBISWorld.com
Cost Structure
Benchmarks
Profit
Sector profitability, defined as earnings before

interest and taxes, is expected to account for
47.6% of sector revenue in 2020, up from 46.7%
in 2015. Sector profitability accounts for such a
large portion due to the high share of
nonemploying enterprises in the Real Estate
subsector, particularly in the Apartment Rental
industry (IBISWorld report 53111) which records
rents as profit since the wage they pay
themselves are rents and are essentially just
profit. Moreover, operators in the Commercial
Leasing industry (IBISWorld report 53112)
records profit of over 50.0% of industry revenue,
pushing sector profitability up. Overall, sector
profitability has risen somewhat in recent years
as a result of strong macroeconomic conditions,
though this is somewhat in doubt in regard to
2020 considering the COVID-19 outbreak. Sector
profitability is expected to weaken slightly over
the next five-year period due to continued
increases in vacancy and a reversal of economic
conditions. Lastly, it should be made clear that
2020 represents a decline from higher levels of
profitability observed during the period.
Furthermore, profitability is expected to weaken
over the next five years as a difficult operating
environment sets in.
28 IBISWorld.com
Wages
Sector wages are estimated to account for

17.6% of sector revenue in 2020, steady since
2015. Wages in this sector are skewed upward
by operators in the Rental and Leasing
subsector because it has a lower proportion of
nonemploying operators, which necessitates
that they pay wages. Operators in the Real
Estate subsector pay lower wages, but also have
a higher portion of nonemploying enterprises,
which will bias wages downward because
nonemploying enterprises in this subsector will
pay themselves with profit, necessitating low
wage costs. Sector wages as a share of revenue
are expected to remain largely flat over the next
five years due to slow trends in hiring as a result
of the COVID-19 slowdown.
Purchases
Purchase costs are estimated to account for

1.0% of sector revenue in 2020. Purchase costs
are low on average due to the fact that
operators in the Real Estate subsector do not
engage in much purchasing activity, requiring
few inputs to operate. Purchases in this
subsector typically include software or
maintenance charges. Conversely, operators in
the Rental and Leasing subsector will incur
higher purchase costs, typically closer to 15.0%,
due to the need to stock an inventory of goods
and equipment available for rent or lease.
Depreciation
Depreciation charges are estimated to account

for 19.0% of sector revenue in 2020. Both
operators in the Real Estate and the Rental and
Leasing subsectors exhibit high depreciation
charges due to the nature of the goods and
services they provide. Depreciable assets in the
Real Estate subsector include commercial
buildings and residential dwellings, and the
upkeep they require. Likewise, operators in the
Rental and Leasing subsector also have high
depreciation costs. Depreciable assets in this
subsector include heavy industrial and
construction equipment as well as rental cars,
all of which incur heavy depreciation charges
and wear and tear.
29 IBISWorld.com
Marketing
Marketing expenses are expected to be minimal

for this sector, due to the fact that most
operators will rely on word-of-mouth referrals.
Moreover, since most goods provided by the
Rental and Leasing subsector are substitutable,
a proven reputation for customer satisfaction
and fair prices will prove more beneficial than an
advertising campaign. Additionally, real estate is
typically not advertised to an extreme extent,
with residential lessors relying on word of
mouth referrals. Marketing is expected to
account for only 0.5% of sector revenue in 2020.
Rent
Rent charges account for an estimated 0.9% of

sector revenue in 2020. Since storefronts must
be rented and maintained, operators in the rental
and leasing subsegment tend to have higher
rent costs, namely because rent is not a factor
for Real Estate subsector operators if buildings
are owned.
Utilities
Utilities costs are expected to account for 0.7%

of industry revenue in 2020. Utilities costs tend
to be higher in the Real Estate subsector
because residential dwellings consume large
amounts of power and water. This subsector
pushes up the average sector utility costs
because operators in the Rental and Leasing
subsector typically pay half the sector average
for rent and utilities.
30 IBISWorld.com
Other Costs
Other costs, such as insurance and

administrative expenses, account for an
estimated 12.8% of industry revenue in 2020.
Basis of Competition in this industry is Medium and Increasing

Competition
Internal competition
The Real Estate and Rental and Leasing sector does not exhibit a
high degree of internal competition due to the fact that many
industry services will complement one another, whereby operators
across industry groups will not be overly concerned with the
performance of their sector counterparts.
For example, competition between operators that provide residential real estate are
not necessarily competing with operators that lease and rent automobiles or heavy
equipment. Moreover, due to the difference between the consumer market and
commercial market for vehicle and equipment rentals, operators that rent and lease
vehicles do not directly compete with those that lease or rent construction
equipment or other heavy machinery. Additionally, operators in the Real Estate
Sales and Brokerages industry (IBISWorld report 53121) can actually help operators
in the Apartment Rental industry (IBISWorld report 53111) by helping to fill vacant
units. In this sector, it appears that the biggest source of competition is the
disparity between the number of nonemploying enterprises and employing
enterprises in the sector. With 87.5% of operators being nonemploying, accounting
for 43.1% of sector revenue, there is competition for customers between employing
enterprises and nonemploying enterprises. Despite this, the nonemployer share of
sector revenue has been declining, representing a weakening in this form of internal
31 IBISWorld.com
competition. Internal competition may heat up as a result of the COVID-19

(coronavirus) outbreak, in that price-based competition in a race to the bottom will
cause landlords to lower rents to fill vacant units, weakening the sector as a whole.
External competition
This sector exhibits a medium degree of external competition,

namely with the Finance and Insurance sector (NAICS 52).
This is due to the fact that once a potential homeowner takes out a conventional
mortgage on the property or home, this activity is now treated as a financial
instrument and not as a Real Estate sector transaction. Above all, this sector
competes most with those sectors that let customers buy or purchase products
that this sector rents or leases. For example, a rising homeownership rate will
indicate declining demand for rental accommodations, while consumers who
purchase their own automobiles or heavy equipment will also siphon revenue from
this sector. This sector does not experience stiff competition from overseas
operators, as most transactions and assets occur in, and are located in, the United
States.
Barriers to Entry Barriers to entry in this industry are Low and Steady
Overall, barriers to entry in the Real

Estate and Rental and Leasing sector Barriers to entry checklist
are low to moderate. Barriers to entry Competition Medium
namely include capital costs and costs
Concentration Low
associated with acquiring an inventory
and a market presence. Typically, Life Cycle Stage Mature
barriers to entry in the Real Estate
Technology Change Medium
subsector are higher due to the fact that
capital costs associated with buildings Regulation & Policy Medium
and land are far greater than those
Industry Assistance Low
associated with automobiles or heavy
equipment. Although barriers still exist
for operators in the Rental and Leasing subsector, they are lower than those for
operators in the Real Estate subsector. This is because it is easy for small operators
to enter this sector, evidenced by the overwhelming majority of nonemploying
enterprises comprising this sector's structure, but it is difficult for them to scale and
succeed on a national basis. However, it may be difficult for operators to succeed in
population-dense urban areas due to the high price of real estate and high rents for
storefronts. Moreover, these areas tend to earn operators the highest returns in the
Real Estate subsector due to shortage of space and high levels of demand. Barrier
to entry are unlikely to shift dramatically as a result of the COVID-19 (coronavirus)
outbreak.
Industry Globalization in this industry Low and Steady

Globalization
32 IBISWorld.com
The Real Estate and Rental and Leasing sector exhibits a low-to-average level of
globalization. A majority of operators are based in the United States and, though
several operators conduct business internationally, the overwhelming share of
business tends to be conducted within US borders. This is mainly due to the fact
that most assets cannot be moved or are cost prohibitive to transport overseas.
However, among some industry groups, the Car Rental industry (IBISWorld Report
53211) does exhibit a high degree of globalization with major operators conducting
business at many international locations, and primarily airports. Overall, despite this
one industry in the sector, a majority of business is conducted within US borders.
Globalization is unlikely to shift dramatically as a result of the COVID-19
(coronavirus) outbreak.
33 IBISWorld.com
Major Companies
Major Players UNITED RENTALS INC.
Market Share: 0.5%

Headquartered in Stamford, CT, United Rentals
Inc. (United Rentals) was founded in 1997 and
is the world's largest equipment rental
company. The company has a staggering
product inventory with over 3,300 classes of
equipment for rent to construction and
industrial companies, manufacturers, utilities,
municipalities, homeowners, government
entities and other markets. The rental fleet is
made up of more than 440,000 units valued at
more than $9.0 billion, which includes
backhoes, forklifts, generators, boom lifts and construction lasers. In 2020, the
company is expected to earn a total revenue of $8.1 billion, amid the current
downturn in the US economy as a result of COVID-19 (coronavirus). United Rentals'
US equipment rental operations account for greater than 85.0% of the company's
total sales, with the majority of the remaining revenue coming from new and used
equipment sales.
The company has been active in some acquisitions during the period. In 2017,
United Rentals completed the acquisition of NES Rentals (NES) for $965.0 million in
34 IBISWorld.com
cash. United Rentals is the largest operator in the Heavy Equipment Rental industry
(IBISWorld report 53241). Additionally, the company is expected to have a market
share greater than 5.0% in the Industrial Equipment Rental and Leasing industry
(IBISWorld report 53249).
Financial performance
Over the five years to 2020, United Rentals' US Real Estate and Rental and Leasing
sector-relevant revenue is expected to grow at an annualized rate of 7.9% to $5.5
billion. The acquisition has supported continued expansion during the period.
Above all, United Rentals has exhibited strong growth due to a burgeoning US
construction sector. Overall, a strategic acquisition and a strong construction sector
have promoted company growth during the period. Moreover, the company's sector-
and US-relevant operating income is expected to increase an annualized 5.2% to
reach $1.2 billion in 2020. It is also worth noting that revenue is expected to decline
in 2020 as a result of the coronavirus outbreak. Overall, demand conditions have
weakened, with nonresidential construction plummeting in 2020, which is expected
to undercut revenue growth in 2020.
United Rentals Inc. (US sector-relevant segment) - financial performance*

Year Revenue Growth Operating Income Growth
($m) (% change) ($m) (% change)
2015 3787.7 N/C 988.4 N/C
2016 3879.4 2.4 952.7 -3.6
2017 4505.0 16.1 1022.3 7.3
2018 5509.0 22.3 1335.7 30.7
2019 6190.5 12.4 1424.6 6.7
2020 5527.9 -10.7 1272.2 -10.7
Source: IBISWorld
Note: *Estimates
REALOGY HOLDINGS CORP.
Market Share: 0.5%

Realogy Holdings Corp. (Realogy) is a global
provider of real estate services, including
franchising, brokerage and relocation and title
services and is headquartered in Madison, NJ.
Realogy is the parent company for some of
the most notable real estate brands and
trademarks, such as NRT LLC, Century 21,
TRG and Better Homes and Gardens Real
Estate. NRT LLC is the company's largest
subsidiary and is affiliated with the Coldwell
Banker, ERA and Sotheby's International
Realty. Realogy is the one of the largest operators in the country, with 14,800
offices and 289,000 agents across 116 countries. Company operating segments
include: real estate franchise; company-owned real estate brokerage; relocation;
and title and settlement services. Although Realogy is involved in the buying and
selling of residential real estate, the company's subsidiaries also list residential
homes for rent. Realogy is active in several sector-relevant industries through its
numerous subsidiaries. For example, in the Real Estate Sales and Brokerages
35 IBISWorld.com
industry (IBISWorld report 53212) and in the Real Estate Asset Management and
Consulting industry (IBISWorld report 53139).
According to the company's most recent financial release, company revenue totaled
$5.5 billion in 2019 and is expected to reach $5.3 billion in 2020, as demand
conditions weaken significantly as a result of the coronavirus outbreak. Nearly
98.0% of Realogy's business is conducted within the United States, and sector- and
US-relevant revenue is expected to total $5.2 billion in 2020, representing an
annualized 1.4% increase from 2015. Additionally, the company's operating income
has exhibited an annualized 3.0% decline to reach an estimated $547.4 million in
2020. Overall, the company has been engaging in some acquisition activity via its
subsidiaries NRT and TGR. In 2015, the company acquired 13 real estate brokerage
operations through NRT for a cash consideration of $96.0 million. Additionally, in
the same year, the wholly owned subsidiary TRG acquired three title and settlement
operations for a cash consideration of $34.0 million. In 2016, NRT acquired 11 real
estate brokerages and property management operations for a cash consideration
of $74.0 million, while TRG acquired one title settlement operation for $10.0 million.
This activity has continued in 2017, with NRT purchasing 16 real estate brokerages
for $11.0 million, while TRG acquired another two title and settlement operations.
Realogy Holdings Corp. (US sector-relevant segment) - financial performance*

2015 5579.0 N/C 709.8 N/C
2016 5683.0 1.9 716.9 1.0
2017 5997.0 5.5 711.1 -0.8
2018 5961.0 -0.6 645.2 -9.3
2019 5475.6 -8.1 692.1 7.3
2020 5193.9 -5.1 547.4 -20.9
Source: IBISWorld
Note: *Estimates
CBRE GROUP INC.
Market Share: 0.4%

Los Angeles-based CBRE Group Inc. (CBRE)
operates more than 450 offices in more than
100 countries. Formerly known as CB Richard
Ellis Group, the company is one of the largest
commercial real estate service operators in
the world. Founded in 1906, and employing
more than 80,000 people globally, the
company is focused on commercial property
and corporate facilities management,
occupier and property or agency leasing,
property sales, valuation, real estate
investment management, commercial mortgage origination and servicing, capital
markets (equity and debt) solutions, development services and proprietary
research. CBRE is expected to hold a nearly 2.0% market share in the Real Estate
Asset Management and Consulting industry (IBISWorld report 53139) and an
36 IBISWorld.com
estimated 6.6% market share in the Real Estate Appraisal industry (IBISWorld report
53132). Additionally, the company is estimated to have a near 2.0% market share of
the Real Estate Sales and Brokerages industry (IBISWorld report 53121).
CBRE participates in this sector via several segments, including occupier

outsourcing (relocation services), property management and leasing. The loan
servicing and capital markets segments are excluded from this analysis. CBRE's
leasing and sales segments, which account for 30.8% of company revenue, offer
real estate tenants, investors and owners strategic advice with regard to the
leasing, disposition and acquisition of property, market appraisals, litigation
support, feasibility studies and discounted cash flow analysis. Over the five years to
2020, the company has expanded through a series of acquisitions, such as its
purchase of The Furman Company, a South Carolina-based commercial real estate
brokerage and management services company, Additionally, the company
purchased Global Workplace Solutions Business in 2015 for $1.5 billion paid to the
parent company Johnson Controls Vends.
In 2020, CBRE will earn an estimated $22.4 billion in total company revenue. Over
the five years to 2020, CBRE's US sector-specific revenue is expected to increase at
an annualized rate of 17.5% to $4.3 billion. It should be noted that in the third
quarter of 2018, CBRE announced that it was changing its revenue recognition
methods, and thus results for 2016 and 2017 were revised, posting marked
increases over their previously stated values. It appears that, due to a weakening
outlook, CBRE is pursing different growth strategies to keep ahead of the industry.
Since the housing market recovery, which began prior to the period, the company
has exhibited strong increases in both sector-specific and total revenue.
Additionally, the company is expected to earn $225.6 million in operating profit in
2020, representing an annualized 8.9% increase in sector-specific operating
income. Overall, CBRE's diversity is expected to enable it to weather the stronger
declines in revenue exhibited in 2020 as a result of the coronavirus outbreak,
though is still expected to take a hit in 2020 alone.
CBRE Group Inc. (US sector-relevant segment) - financial performance*

2015 1911.4 N/C 147.2 N/C
2016 2206.6 15.4 103.6 -29.6
2017 2368.3 7.3 137.1 32.3
2018 4035.4 70.4 205.7 50.0
2019 4557.9 12.9 240.3 16.8
2020 4278.7 -6.1 225.6 -6.1
Source: IBISWorld
Note: *Estimates
37 IBISWorld.com
AVIS BUDGET GROUP INC.
Market Share: 0.3%

Avis Budget Group Inc. (Avis), is based in
Parsippany, NJ, and rents cars and trucks in
the United States, Canada, Australia, New
Zealand and the Caribbean. Avis has nearly
30,000 employees globally, with 20,000
employed within the United States. Avis is
made up of two brands: Avis Rent-A-Car
System and Budget Rent-A-Car. Avis Rent-A-
Car System is concentrated on providing
services for business travelers and premium
leisure travelers, while Budget Rent-A-Car
targets price-conscious travelers. Overall, an estimated 86.0% of Avis' revenue is
considered sector-specific. Avis operates 10,000 locations globally, with a rental
fleet of 520,000 vehicles.
The company has also been active in acquisitions such as the purchase of car-
sharing company Zipcar in 2015, which now has more than 860,000 members in the
United States, Canada and Europe. Additionally, Avis acquired Payless Car Rental
Inc. prior to 2015, which was then the sixth-largest car rental company in North
America with 120 retail locations and $80.0 million in annual revenue. Moreover,
Avis announced a partnership with Waymo, Google's self-driving car project, in
2017. Avis is expected to perform vehicle cleaning, part replacement and scheduled
maintenance, as well as provide parking and storage for Waymo's autonomous test
fleet. In exchange for supplying fleet management services, Avis will gain access to
Waymo's autonomous vehicle technology.
Over the five years to 2020, Avis is expected to earn total company revenue of $5.8
billion, a sharp decline from 2019, as a result of the outbreak of coronavirus causing
international and domestic travel to plummet. Sector- and US-specific revenue is
expected to decline an annualized 9.4% to reach an estimated $3.4 billion in 2020.
Additionally, Avis' sector- and US-specific operating income has exhibited an
annualized decline of 13.2% to reach $295.6 million, as a result of weaker
conditions in 2020. Overall, Avis has exhibited the largest exposure of industry
players to the outbreak of coronavirus, and has thus had performance expectations
revised downward.
Avis Budget Group Inc. (US sector-relevant segment) - financial performance*

2015 5635.0 N/C 589.5 N/C
2016 5674.0 0.7 549.1 -6.9
2017 5629.0 -0.8 467.6 -14.8
2018 5708.0 1.4 488.6 4.5
2019 5867.0 2.8 504.1 3.2
2020 3441.4 -41.3 295.6 -41.4
Source: IBISWorld
Note: *Estimates
38 IBISWorld.com
Operating Conditions
Capital Intensity The level of capital intensity is High
The Real Estate and Rental and Leasing sector

exhibits a high level of capital intensity. By
using total sector wages as a proxy for labor
and sector depreciation charges as a proxy for
capital, IBISWorld analysis finds that for every
dollar spent on labor, operators in this sector
will spend an estimated $1.08 on capital
goods. Depreciation charges are largely
consistent across the sector, typically
accounting for 15.0% to 20.0% of industry
group revenue. Capital goods needed in this
sector are buildings and dwellings, heavy
construction and industrial equipment and
machinery, as well as automobiles and trucks.
Overall, the nature of this sector is highly
capital intensive and requires a large amount
of capital to begin and sustain operations.
Buildings must be purchased and rented out,
heavy equipment and automobiles must also
be purchased by sector operators and leased
out. It is highly expensive to establish a well-
stocked inventory and maintain a vehicle fleet.
Technology And Potential Disruptive Innovation: Factors Driving Threat of Change

Systems Level Factor Disruption Description
Annualized growth in the number of

enterprises in the industry, ranked against
Very High Rate of Entry Very Likely all other industries. A greater intensity of
companies entering an industry increases
the pool of potential disruptors.
A ranked measure of the largest core

Market market for the industry. Concentrated core
Very High Very Likely markets present a low-end market or new
Concentration market entry point for disruptive
technologies to capture market share.
A qualitative measure of barriers to entry.

Fewer barriers to entry increases the
High Ease of Entry Likely likelihood that new entrants can disrupt
incumbents by putting new technologies
to use.
A ranked measure for the number of

Rate of patents assigned to an industry. A faster
Unknown Unknown rate of new patent additions to the
Innovation industry increases the likelihood of a
disruptive innovation occurring.
39 IBISWorld.com
Level Factor Disruption Description
A measure for the mix of patent classes

Innovation assigned to the industry. A greater
Unknown Unknown concentration of patents in one area
Concentration increases the likelihood of technological
disruption of incumbent operators.
This technology trend is underscored by structural factors that support new

entrants. An accommodative structure can create a situation where small entrants
can focus on less profitable albeit innovative industry entry points. Or, large
operators in other industries can leverage expertise in other areas to enter the
industry from a new angle.
The major markets for this industry are highly concentrated, which implies that the
market has a focus on key customer segments. This presents an opportunity for
strategic entrance into lower-end markets or unserved markets for innovations to
take on a disruptive trajectory.
The level of technology change is Medium
The Real Estate and Rental and Leasing sector exhibits a medium
level of technological change.
The Real Estate subsector has been improving operational efficiencies by adopting
automated administrative software and new property databases. Additionally, the
sector could benefit greatly with the adoption of block-chain technology, which has
not yet become completely applicable. However, through the standardization of
record keeping and property and lease documents, sector operators would be more
well informed and better able to execute decisions. The Rental and Leasing
subsector is subject to some technological change as well. The equipment, vehicles
and goods rented and leased by the subsector are often being reconfigured and
remodeled to produce more efficient outcomes. However, it is important to note
that most rented and leased goods are substitutable. Therefore, the greatest
application for technology in this subsector would be the use of self-driving cars as
well as auto-guided construction and industrial machinery.
40 IBISWorld.com
Revenue Volatility The level of volatility is Low
Note: Revenue growth and decline reflective of 5-year annualized trend. Y-axis is in
logarithmic scale. Y-axis crosses at long-run GDP. X-axis crosses at high volatility
threshold.
The Real Estate and Rental and Leasing sector exhibits a low level of
revenue volatility.
Volatility can be injected into this sector by financial shocks and rapid changes in
real estate market conditions. However, this sector has remained steady during the
current period, with volatility mitigating in the wake of the Great Recession. The
Federal Reserve's commitment to gradually raise interest rates has not severely
affected this sector since it signaled its intentions well ahead of time, enabling
sector operators to prepare for impending rate hikes. Additionally, steady
construction activity and rising domestic travel have kept the Rental and Leasing
subsector stable over the five years to 2020.
Regulation & The level of regulation is Medium and is Steady

Policy
Operators in the Real Estate subsector of the Real Estate and Rental
and Leasing sector are subject to all federal and state regulations
concerning building codes and public safety standards.
Residential dwelling unfit for occupancy cannot be leased. Likewise, industrial and
commercial real estate that is not in compliance with safety and zoning codes is
also liable. This sector is also subject to regulations concerning Real Estate
Investment Trusts (REITs). Real estate companies and developers can elect to be
taxed as a REIT under Section 856 through 860 of the Internal Revenue Code. As a
REIT, these organizations must distribute, at a minimum, an amount equal to 90.0%
of taxable income and must distribute 100.0% of taxable income to avoid paying
41 IBISWorld.com
corporate federal income taxes. REITs are also subject to several organizational
and operational requirements to retain their REIT status. They must be structured
as a corporation, business trust or similar association and be managed by a board
of directors or trustees. They must derive at least 75.0% of their gross income from
rents or mortgage interests and at least 75.0% of their total investment assets must
be in real estate.
Industry The level of industry assistance is Low and is Steady

Assistance
The Real Estate and Rental and Leasing sector does not receive
direct support from the federal government.
However, the Real Estate subsector does receive indirect assistance from
Government Sponsored Entities (GSE). The Federal Home Loan Mortgage
Corporation (FHLMC), known as Freddie Mac, provides support through the
stabilization of the real estate and housing market by purchasing mortgages on the
secondary market. Although this is technically a financial service, the stability
provided to the Real Estate sector is a boon for subsector operators. The Rental and
Leasing subsector does not receive direct support from the federal government, but
benefits from the presence of trade associations and groups that advocate and
educate on behalf of sector interests.
CARES Act of 2020
There are several provisions contained within the Coronavirus Aid,

Relief and Economic Security (CARES) Act to provide relief for
residential landlords and tenants.
First, tenants experiencing hardship as a result of COVID-19 (coronavirus) may
request a forbearance on their obligations. In addition to forbearances on
residential and multi-family borrowers, the CARES act forbids the eviction of
tenants for delinquent payment for 180 days. Though these protections may help
the industry, it is difficult to say whether these measures will aid the sector long-
term, or whether they are simply a stopgap measure. Overall, if consumers cannot
return to work after the 180-day period is up, it is likely they will get evicted due to
nonpayment, which will severely undercut the industry during the outlook period.
Moreover, since most sector operators are small or considered nonemploying, it is
likely that many operators have employment figures of fewer than 500 people,
which makes them eligible to receive funding from the Paycheck Protection Plan or
Small Business Administration Loans, blunting the impact of the virus to some
degree. Overall, the Paycheck Protection Plan loans are aimed at retaining
employees, limiting job losses and ensuring that employees who are laid off have
an enterprise to return to once things clear up.
42 IBISWorld.com
Key Statistics
Industry Data
Demand Vacancy
Rate
2011 775,451 649,596 2,687,449 2,608,752 4,263,406 N/A N/A 143,226 N/A 9.52
2012 811,662 685,097 2,739,682 2,659,940 4,330,587 N/A N/A 148,588 N/A 8.68
2013 848,243 695,927 2,805,815 2,724,779 4,420,387 N/A N/A 149,659 N/A 8.32
2014 889,859 746,041 2,910,867 2,826,557 4,565,163 N/A N/A 156,954 N/A 7.55
2015 935,013 778,270 3,013,382 2,927,152 4,701,207 N/A N/A 164,902 N/A 7.05
2016 967,743 804,920 3,068,528 2,978,086 4,789,446 N/A N/A 168,145 N/A 6.85
2017 998,011 827,470 3,191,321 3,090,863 4,932,759 N/A N/A 172,774 N/A 7.18
2018 1,025,259 856,798 3,294,258 3,190,974 5,085,899 N/A N/A 178,077 N/A 6.88
2019 1,049,455 885,913 3,383,749 3,278,318 5,211,525 N/A N/A 182,436 N/A 6.75
2020 1,030,208 867,511 3,421,150 3,320,874 5,193,650 N/A N/A 181,266 N/A 6.65
2021 1,015,411 839,498 3,460,568 3,364,844 5,185,131 N/A N/A 180,508 N/A 6.96
2022 1,029,172 844,869 3,531,393 3,435,324 5,267,653 N/A N/A 183,295 N/A 7.22
2023 1,026,092 834,408 3,575,833 3,482,192 5,288,805 N/A N/A 183,774 N/A 7.44
2024 1,051,102 854,693 3,658,223 3,562,283 5,405,712 N/A N/A 187,920 N/A 7.64
2025 1,061,628 860,380 3,716,175 3,620,378 5,469,637 N/A N/A 190,074 N/A 7.81
Annual Change
Demand Vacancy
Rate
(%) (%) (%) (%) (%) (%) (%) (%) (%) (%)
2011 2.47 2.48 -0 -0 -1 N/A N/A 1.41 N/A -6.85
2012 4.66 5.46 2 2 2 N/A N/A 3.74 N/A -8.93
2013 4.50 1.58 2 2 2 N/A N/A 0.72 N/A -4.04
2014 4.90 7.20 4 4 3 N/A N/A 4.87 N/A -9.31
2015 5.07 4.31 4 4 3 N/A N/A 5.06 N/A -6.63
2016 3.50 3.42 2 2 2 N/A N/A 1.96 N/A -2.84
2017 3.12 2.80 4 4 3 N/A N/A 2.75 N/A 4.74
2018 2.73 3.54 3 3 3 N/A N/A 3.06 N/A -4.19
2019 2.35 3.39 3 3 2 N/A N/A 2.44 N/A -1.82
2020 -1.84 -2.08 1 1 -0 N/A N/A -0.65 N/A -1.42
2021 -1.44 -3.23 1 1 -0 N/A N/A -0.42 N/A 4.65
2022 1.35 0.63 2 2 2 N/A N/A 1.54 N/A 3.67
2023 -0.30 -1.24 1 1 0 N/A N/A 0.26 N/A 3.04
2024 2.43 2.43 2 2 2 N/A N/A 2.25 N/A 2.61
2025 1.00 0.66 2 2 1 N/A N/A 1.14 N/A 2.32
Key Ratios
Year IVA/Revenue Imports/Demand Exports/Revenue Revenue per Wages/Revenue Employees per Average Wage
Employee estab.
(%) (%) (%) ($'000) (%)
2011 83.8 N/A N/A 182 18.5 1.59 33,594
2012 84.4 N/A N/A 187 18.3 1.58 34,311
2013 82.0 N/A N/A 192 17.6 1.58 33,857
2014 83.8 N/A N/A 195 17.6 1.57 34,381
2015 83.2 N/A N/A 199 17.6 1.56 35,076
2016 83.2 N/A N/A 202 17.4 1.56 35,107
2017 82.9 N/A N/A 202 17.3 1.55 35,026
2018 83.6 N/A N/A 202 17.4 1.54 35,014
2019 84.4 N/A N/A 201 17.4 1.54 35,006
2020 84.2 N/A N/A 198 17.6 1.52 34,902
2021 82.7 N/A N/A 196 17.8 1.50 34,813
2022 82.1 N/A N/A 195 17.8 1.49 34,796
2023 81.3 N/A N/A 194 17.9 1.48 34,748
2024 81.3 N/A N/A 194 17.9 1.48 34,763
2025 81.0 N/A N/A 194 17.9 1.47 34,751
43 IBISWorld.com
Additional Resources
Additional Federal Home Loan Mortgage Corporation
Resources http://www.freddiemac.com
Department of Housing and Urban Development

http://www.hud.gov
National Association of Realtors

http://www.nar.realtor
Industry Jargon OCCUPIER OUTCOURING

Relocation services.
REIT
Real Estate Investment Trust, which is a company that owns, and in most cases, operates
income-producing real estate.
RENTAL VACANCY RATE

The measure of unoccupied rental units on the market.
Glossary Terms BARRIERS TO ENTRY

High barriers to entry mean that new companies struggle to enter an industry, while low
barriers mean it is easy for new companies to enter an industry.
CAPITAL INTENSITY
Compares the amount of money spent on capital (plant, machinery and equipment) with
that spent on labor. IBISWorld uses the ratio of depreciation to wages as a proxy for capital
intensity. High capital intensity is more than $0.333 of capital to $1 of labor; medium is
$0.125 to $0.333 of capital to $1 of labor; low is less than $0.125 of capital for every $1 of
labor.
CONSTANT PRICES
The dollar figures in the Key Statistics table, including forecasts, are adjusted for inflation
using the current year (i.e. year published) as the base year. This removes the impact of
changes in the purchasing power of the dollar, leaving only the "real" growth or decline in
industry metrics. The inflation adjustments in IBISWorld’s reports are made using the US
Bureau of Economic Analysis’ implicit GDP price deflator.
44 IBISWorld.com
DOMESTIC DEMAND
Spending on industry goods and services within the United States, regardless of their
country of origin. It is derived by adding imports to industry revenue, and then subtracting
exports.
EMPLOYMENT
The number of permanent, part-time, temporary and seasonal employees, working
proprietors, partners, managers and executives within the industry.
ENTERPRISE
A division that is separately managed and keeps management accounts. Each enterprise
consists of one or more establishments that are under common ownership or control.
ESTABLISHMENT
The smallest type of accounting unit within an enterprise, an establishment is a single
physical location where business is conducted or where services or industrial operations are
performed. Multiple establishments under common control make up an enterprise.
EXPORTS
Total value of industry goods and services sold by US companies to customers abroad.
IMPORTS
Total value of industry goods and services brought in from foreign countries to be sold in
the United States.
INDUSTRY CONCENTRATION
An indicator of the dominance of the top four players in an industry. Concentration is
considered high if the top players account for more than 70% of industry revenue. Medium
is 40% to 70% of industry revenue. Low is less than 40%.
INDUSTRY REVENUE
The total sales of industry goods and services (exclusive of excise and sales tax); subsidies
on production; all other operating income from outside the firm (such as commission
income, repair and service income, and rent, leasing and hiring income); and capital work
done by rental or lease. Receipts from interest royalties, dividends and the sale of fixed
tangible assets are excluded.
INDUSTRY VALUE ADDED (IVA)

The market value of goods and services produced by the industry minus the cost of goods
and services used in production. IVA is also described as the industry's contribution to GDP,
or profit plus wages and depreciation.
45 IBISWorld.com
INTERNATIONAL TRADE
The level of international trade is determined by ratios of exports to revenue and imports to
domestic demand. For exports/revenue: low is less than 5%, medium is 5% to 20%, and high
is more than 20%. Imports/domestic demand: low is less than 5%, medium is 5% to 35%,
and high is more than 35%.
LIFE CYCLE
All industries go through periods of growth, maturity and decline. IBISWorld determines an
industry's life cycle by considering its growth rate (measured by IVA) compared with GDP;
the growth rate of the number of establishments; the amount of change the industry's
products are undergoing; the rate of technological change; and the level of customer
acceptance of industry products and services.
NONEMPLOYING ESTABLISHMENT
Businesses with no paid employment or payroll, also known as nonemployers. These are
mostly set up by self-employed individuals.
PROFIT
IBISWorld uses earnings before interest and tax (EBIT) as an indicator of a company’s
profitability. It is calculated as revenue minus expenses, excluding interest and tax.
REGIONS
West | CA, NV, OR, WA, HI, AK
Great Lakes | OH, IN, IL, WI, MI
Mid-Atlantic | NY, NJ, PA, DE, MD
New England | ME, NH, VT, MA, CT, RI
Plains | MN, IA, MO, KS, NE, SD, ND
Rocky Mountains | CO, UT, WY, ID, MT
Southeast | VA, WV, KY, TN, AR, LA, MS, AL, GA, FL, SC, NC
Southwest | OK, TX, NM, AZ
VOLATILITY
The level of volatility is determined by averaging the absolute change in revenue in each of
the past five years. Volatility levels: very high is more than ±20%; high volatility is ±10% to
±20%; moderate volatility is ±3% to ±10%; and low volatility is less than ±3%.
WAGES
The gross total wages and salaries of all employees in the industry.
46 IBISWorld.com
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53 Real Estate and Rental and Leasing in The US Industry Report

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US INDUSTRY (NAICS) REPORT 53

Real Estate and Rental and Leasing in the US

IBISWorld.com +1-800-330-3772 info@IBISWorld.com

About This Industry...........................................5 Competitive Landscape...................................27

Industry Definition..........................................................5 Market Share Concentration....................................... 27

Industry at a Glance.......................................... 7 Major Companies............................................ 34

Executive Summary....................................................... 9 Major Players............................................................... 34

Industry Performance..................................... 10 Operating Conditions...................................... 39

Key External Drivers.....................................................10 Capital Intensity........................................................... 39

· The real estate subsector is expected to experience stiff headwinds as a result of

· The rental of equipment may be buoyed as capital expenditures are trimmed by

About This Industry

Major Players United Rentals Inc.

Realogy Holdings Corp.

CBRE Group Inc.

Avis Budget Group Inc.

Main Activities The primary activities of this industry:

Renting and leasing of intangible assets (i.e. patents)

Managing, renting, selling, buying real estate

The major products and services in this industry:

Rental and leasing

Lessors of nonfinancial intangible assets

RELATED INTERNATIONAL INDUSTRIES

2015-2020 2020-2025 2015-2025 -0.4%

$490.4bn POSITIVE IMPACT

Annual Growth Annual Growth Revenue Volatility Concentration

47.6% MIXED IMPACT

5m Economic fundamentals underpinning sector growth are not

$181.3bn Amid a wave of evictions and a drying up of cashflow,

Products & Services Segmentation

68.5% 24.5% 7.0%

Real estate Rental and leasing Lessors of nonfinancial

Major Players % = share of industry revenue SWOT

Moreover, as residential and nonresidential construction activity increases, so does

Key External Rental vacancy rates

Value of residential construction

Per capita disposable income

Yield on 10-year Treasury note

Current It is important to consider the effect of the global outbreak of

Fundamentals are not so fun

Overall, the largest concerns this sector experiences are in regard to

Cash crunch looming

During the current period, commercial and residential real estate

Airbnb's online platform are enduring a massive deadfall in demand, slashing

Additionally, amid rising unemployment and the forced closure of businesses

Luxury markets weigh on affordable rents

A potent combination of oversupply and under-demand has set the

However, as a result of strong rent growth, the subsector showed strong

Historical Performance Data

Déjà vu with a twist

Overall, similar effects were experienced in the aftermath of the

To be clear, there is an affordability crisis looming on top of the already wide

This general softening in the residential real estate market is

this remains to be seen in the immediate aftermath of coronavirus in the second

Rental and leasing services contend with headwinds

Performance Outlook Data

LIFE CYCLE REASONS

Stable product markets

Medium level of technological change

Established end market

Products and Markets

Real Estate (NAICS 531)

The Real Estate subsector accounts for the majority of sector