1、2024 Economic and Markets OutlookInflation normalizing,real estate pricing rebound,lower interest rates,economy avoids hard landingJA N UA R Y 2 0 2 4BLUEROCK|2024 ECONOMIC AND MARKETS OUTLOOKContentsIntroduction|1Macro Outlook|2Institutional Real Estate and Private Credit Outlook|4Bluerock High Con

2、viction Sectors and Markets Outlook|7We serve a Growing Market Need for alternative investments for individualsWe seek Asymmetric Risk-Return/Alpha Creation in favor of our investorsWe seek Up Escalators,i.e.growing markets with long-term structural tailwinds What We Do:BLUEROCK|2024 ECONOMIC AND MA

3、RKETS OUTLOOKPAGE 1Despite the longest and most significant yield curve inversion in several decades,a declining money supply,declining inflation,and several months of negative leading economic indicators,the long-awaited Federal Reserve-induced recession has yet to materialize.We dont believe reces

4、sion risks have disappeared,but a strong labor market appears to be a material mitigating factor.We do see inflation stabilizing at a lower rate,(approximately 2.0-2.5%year-over-year)but above the deflationary environment that persisted in the post Great Financial Crisis era,and low enough to reduce

5、 the likelihood of any further monetary tightening.After a strong 2023,the U.S.equities market may only offer minimal upside opportunity given equity risk premiums(as measured by S&P 500 earnings yield minus 10 year U.S.Treasury yield)are at decades-low levels.We see short-term interest rates declin

6、ing slightly,but not enough to come close to post-pandemic levels.With longer term rates reversing course at the end of 2023,we believe real estate valuations are likely to bottom in early 2024.The asset class presents powerful opportunities for investors after nearly 20%price declines while simulta