Due to years of low rates, demand for real estate has picked up. Low rates have made investment returns in savings and safe bonds far too inadequate for most, pushing more money into risk assets, of which commercial real estate qualifies.Capitalization rates (i.e., net operating income divided by property value) are among all-time lows. This means investors are seeing the lowest total returns on their investments that they’ve ever experienced historically. (Investment returns qualify as either property price appreciation or through dividends such as renting out office, retail, or warehouse space.)Outstanding US commercial real estate loans now total $4.14 trillion, or 22% of GDP. New highs have been made each month on a seasonally adjusted basis since October 2013. The cyclical low in the industry came in late-2011/early-2012. Commercial real estate ICF lost 78.2% between its February 2007 high and its March 2009 low. It has yet to match that previous high, though it came close in July 2016. It has retraced 11% since that point. Even though the economy appears to be improving, there are numerous headwinds toward further appreciation in commercial real estate. With rising rates, historically low cap rates, and commercial real estate in some level of decline among retail outlets due to more sales shifting online, there are numerous headwinds that suggest risk/reward is slanted downwards. ICF does have a dividend yield of 4.2%iShares Dow Jones US Real Estate ETF IYR (dividend yield of 4.3%) lost 76% of its value from February 2007 to March 2009 and remains 16% off those all-time highs from ten years ago.The late-July 2016 peak coincided with word that rates would very likely be raised later in the year. As rates rise and central bank engineering is no longer a tailwind, further price appreciation will need to be generated from improving business fundamentals such that the demand for commercial property increases.