Author: Edward Brawer

This is Deal Junkie. I’m Michael, it is 8:30 AM Eastern on Monday, August 25, 2025, here’s what we’re covering today: a Manhattan office tower sells at over a 50% discount as the sector’s distress deepens; a major apartment portfolio changes hands while a 63-year-old retailer shuts its doors; and the Fed hints at a rate cut as labor market risks mount.

First, the office market: In New York City, an 18-story office building near Hudson Yards just sold for barely half its previous value. This same tower was bought at the market peak in 2018, and now the new sale price is more than 50% below that peak. For context, seeing a prime Manhattan office trade at such a steep discount would have been unthinkable a few years ago. It underscores how remote work, high interest rates, and tighter lending have hammered office valuations. Investors who paid top dollar before the pandemic are facing some harsh realities. On the flip side, opportunistic buyers with cash are circling. They’re looking for bargain deals like this, betting they can turn these distressed buildings around or repurpose them. It’s a clear sign that price discovery is finally happening in the office sector – lenders and owners are resetting expectations. For CRE investors, this also raises a question: have office values hit bottom, or is there more pain to come? Deals like this suggest values are adjusting down to attract buyers, and we’ll likely see more buildings trade at deep discounts in the coming months.

Turning to multifamily (and a retail twist): One of the country’s largest apartment landlords, Morgan Properties, is making a big bet on rentals. Morgan is acquiring Dream Residential REIT’s portfolio – that’s 3,300 apartment units across 15 properties in the Sunbelt and Midwest – for about $354 million in cash. This is an all-cash deal, and it’s actually giving Dream’s shareholders roughly a 60% premium over where the stock was trading. In plain English, Morgan sees more long-term value in those apartments than the public market did. Most of these properties are garden-style complexes in places like Texas, Ohio, Kentucky, and Oklahoma, with occupancy over 95%. So demand is strong, and Morgan seems confident enough in the rental market to write a big check despite higher financing costs industry-wide. It shows that well-capitalized investors are still hungry for multifamily – especially if they can buy at a good price. While sales volume in apartments has cooled this year, fundamentals like occupancy and rents in many regions are holding up, so firms like Morgan are seizing opportunities. By contrast, the retail sector is seeing a shake-up. Longtime pharmacy chain Rite Aid – founded in 1962 – is shutting all of its stores as it goes through bankruptcy again. After struggling with debt and shrinking sales, the 63-year-old retailer couldn’t find a savior and is liquidating its more than 1,000 locations. This is one of the largest retail collapses we’ve seen in a while. It means a lot of storefronts – often in neighborhood shopping centers – will be coming vacant. Other chains might swoop in to lease some of those spaces (for example, CVS or Walgreens could take over certain sites, or local grocers and dollar stores might fill the gaps). But for many community shopping plazas, a closed Rite Aid leaves a big hole to fill. It’s a reminder that not all retail is recovering evenly. Grocery-anchored centers and well-located retail are thriving, but weaker brands like this pharmacy chain are still falling by the wayside. CRE investors in retail have to stay nimble – in this case, some may find opportunity in redeveloping or re-leasing the dark stores, while others could feel the pain of lost rent until new tenants are secured.

And in the broader economy, all eyes are on the Fed. Over the weekend, Federal Reserve Chair Jerome Powell’s comments at Jackson Hole have significantly shifted market expectations. Powell struck a much more cautious tone about the labor market, warning that the recent cool-down in hiring could “materialize quickly” into bigger problems like rising unemployment. That was a subtle but important shift – he’s basically signaling that the Fed is just as worried about economic weakness now as it is about inflation. The impact? Major banks are changing their forecasts. In fact, several top brokerages – think Barclays, BNP Paribas, Deutsche Bank – now predict the Fed will cut interest rates in September, which would be the first rate reduction in about nine months. A week ago, hardly anyone thought a cut was on the table that soon. But Powell’s speech introduced what economists call an “easing bias.” He’s opened the door to a rate drop if the data doesn’t improve. As of this morning, futures markets are pricing in nearly an 85-90% chance of a quarter-point cut at the Fed’s meeting next month. That’s a huge swing in sentiment. Some big players like Bank of America still aren’t convinced – they worry cutting too fast could be a policy error if inflation hasn’t cooled enough. And indeed, we’ll see some key data later this week – for example, the Fed’s favored inflation gauge (the PCE index) – which could either cement or undermine the case for a cut. But for now, real estate investors are hopeful. If the Fed starts easing up on rates, even modestly, it could bring some relief on financing costs. Commercial mortgage rates might tick down, cap rates could stabilize, and buyers sitting on the sidelines might re-enter the market. Of course, one rate cut won’t solve all of CRE’s challenges overnight – we still have high vacancies in some sectors and lenders remaining cautious – but this potential policy shift is a psychological boost. It suggests the era of ever-rising rates is likely over. Powell did caution that any move will depend on the data, so the Fed isn’t promising anything outright. But the tone is notably softer. In short, the next Fed meeting on September 17 just got a lot more interesting for everyone in commercial real estate. Investors will be watching closely, because a confirmed pivot to rate cuts would mark a new chapter, one that could gradually improve borrowing conditions going into 2026.

That’s all for now, but we’ll be back tomorrow. Don’t forget to hit follow or subscribe and leave a review to help others discover the show. I’m Michael—Until next time!

This is Deal Junkie. I’m Michael, it is 8:30 AM Eastern on Wednesday, August 20, 2025, here’s what we’re covering today: Powell signals possible September rate cut in final Jackson Hole speech; institutional deal activity surges in mid-size commercial properties; and Meta brings a billion-dollar data center online.

Let’s start with Fed Chair Jerome Powell, who delivered his closing remarks at Jackson Hole yesterday. He struck a cautiously optimistic tone. While emphasizing the Fed’s commitment to data-driven decision-making, Powell said the combination of cooling job growth, softer consumer sentiment, and easing inflation could justify a rate cut as soon as September—as long as the data continues to cooperate. Markets cheered instantly: the S&P 500 jumped over 1%, and the odds of a rate cut this fall surged above 90%. For commercial real estate investors, this is a turning point. A September move would give some breathing room for refinancing—especially for apartments and offices trapped by high borrowing costs. While Powell noted persistent inflation risks and economic uncertainty, the shift from “holding steady” to “pretty sure we can cut” is music to any dealmaker’s ears. The question now is not if rates will drop, but how much, and over what timeline.

Deal volume is getting a mid-market revival, particularly in the $5 to $25 million range. According to the latest broker rankings, CBRE led the pack with the most mid-size deal activity—jumping ahead of peers and signaling renewed confidence at that level. Volume in this segment grew around 15% year-over-year in H1, outpacing smaller self-managed deals. That reflects a riser sentiment among institutional capital—in other words, big money is buying again, but starting with properties they can underwrite more conservatively. That’s how recoveries usually begin: when the mid-market warms, you start to see a trickle-up toward larger trophy deals. Watch those mid-tier purchases for signs of broader rebound, especially now that financing may ease.

Meta opened a $1 billion-plus data center in Kansas City, underscoring investors’ ongoing belief in digital infrastructure. This new facility is part of a larger 5.5 million-square-foot tech campus developed by Diode Ventures. Demand for data centers remains incredibly strong, driven by rising cloud use, AI workloads, and back-end traffic. For CRE investors, this isn’t just another building—it’s a reminder that real estate tied to digital infrastructure is still commanding premium demand and pricing. Data center real estate has become a very reliable, high-stakes corner of the market.

Let’s add a quick retail and industrial angle. Siemens Energy is relocating its Orlando offices, showing that some corporates are still investing in physical space—even as others shrink. Elsewhere, RCG Ventures bought a large shopping center in Cleveland, signaling that retail continues to attract buyers in well-located markets. On the industrial front, a developer raised $44 million to build new logistics facilities in Atlanta—proof that demand is still alive in high-growth regions.

Bottom line: yesterday’s Fed tone turned conversations from “are rates going up?” to “when will they come down?” That’s a breath of fresh air for commercial real estate. Mid-market deal flow is waking up, and investors are clearly circling opportunity in rental housing, infrastructure, and well-positioned retail and industrial assets. It’s early, but the outlines of a recovery are starting to show.

That’s all for now, but we’ll be back tomorrow. Don’t forget to hit follow or subscribe and leave a review to help others discover the show. I’m Michael—Until next time!

This is Deal Junkie. I’m Michael, it is 8:30 AM Eastern on Wednesday, August 20, 2025, here’s what we’re covering today: the Fed signals tighter duration as inflation pockets flare up; lenders shuffle into CMBS as commercial debt distress worsens; and AI’s data center boom fuels CRE tech infrastructure investments.

First up, the Fed. Released minutes from the July meeting make clear that most officials remain deeply concerned about inflation—despite weak job numbers, price increases in services and the looming impact of tariffs continue to pressure consumer costs. Almost the entire committee opted to stand pat on rates, with only two dissenters favoring cuts. For real estate markets, this means borrowing costs are likely staying elevated at least through the fall. Expect refinancing pain to persist, especially for offices and apartments approaching maturity. Still, markets are pricing in a potential cut later this year—but it will depend on upcoming inflation and labor data. Investors now see the Fed’s Jackson Hole remarks as pivotal in determining the timing of any future easing.

On the brokering front, there’s a notable shift in funding sources. A recent CBRE report reveals commercial real estate loan closings surged by 45% year-over-year in Q2, driven largely by a revival in CMBS issuance and a growing reliance on alternative lenders. Debt funds now account for 34% of brokered loan volume, and CMBS originations nearly tripled, reaching 19% of activity. That means although traditional banks have pulled back, capital is still flowing into real estate via structured securitization and private credit. This is a welcome relief for borrowers, especially in tightening environments. Expect further growth in CMBS transactions as deals get resurrected—but also keep an eye on loan quality amid rising delinquencies.

Finally, let’s talk tech infrastructure and real estate. AI trends aren’t just software-oriented—they’re driving concrete property investor behavior too. Companies supporting data center construction, electrical infrastructure, and building optimization are seeing explosive growth. Firms like Willdan, CBRE (notably through its data center management platform), Primoris Services and others are capitalizing on the AI-led buildout of digital real estate. These businesses are surging, with earnings up sharply and equity performance reflecting massive investor interest. For CRE investors, this means that real estate linked to data center infrastructure isn’t just holding value—it’s a growth sector. Expect continued interest in REITs and developments tied to digital infrastructure and grid expansions that support AI hardware needs.

That’s all for now, but we’ll be back tomorrow. Don’t forget to hit follow or subscribe and leave a review to help others discover the show. I’m Michael—Until next time!

This is Deal Junkie. I’m Michael, it is 8:30 AM Eastern on Wednesday, August 20, 2025, here’s what we’re covering today: the Fed’s latest signals on interest rates as job growth cools; a major real estate lender stepping up as banks retreat; and a cautionary tale of crowdfunded deals going bust.

First up, the macro picture. Later today the Federal Reserve releases minutes from its last meeting, and investors hope to see if rate cuts are on the horizon. The Fed paused hikes in July, but two officials actually voted to cut rates then over concerns the job market was weakening. That worry proved valid: July’s job growth came in far below expectations, and revisions wiped out hundreds of thousands of earlier reported jobs. Combined with inflation still running a bit high, the Fed faces a tricky balance. On the ground, though, industry sentiment is perking up. A Q3 survey shows optimism returning, with many executives believing property values are near a bottom and conditions should improve within a year. There are still winners and losers: apartments and data centers remain solid performers, essential retail is steady, but industrial has a glut of space and offices continue to struggle with high vacancies. In short, the economic signals are mixed, but the mood in commercial real estate is cautiously hopeful.

Next, on the financing front – with traditional banks holding back, private real estate lenders are rushing in. LaSalle Investment Management just raised about $700 million from pension funds, insurers, and other investors for a new real estate debt fund. They plan to make floating-rate loans of $25–$75 million each, focused on multifamily and industrial properties in major markets. This comes as banks have tightened credit amid higher interest rates, leaving many borrowers short on options. LaSalle sees an opening to fill that gap. They’ve already lent out roughly $400 million since spring and expect to hit the full $700 million by the end of this quarter thanks to strong demand. And they’re not alone – other big players are building their own large lending platforms to finance deals. The takeaway: even though debt is pricier now, there’s ample private capital eager to step in, keeping deals alive where banks have bowed out.

Finally, a cautionary tale from the world of crowdfunded real estate. The investment platform Yieldstreet promised everyday investors a chance to invest in property deals – but many of those deals are now unraveling. Out of 30 real estate projects offered on the platform, a handful have already gone bust with complete losses, and most of the rest are teetering on a watchlist. The reasons aren’t surprising: interest costs spiked and property values slid, and quite a few of these deals were over-leveraged or too optimistic from the start. Investments that looked fine when money was cheap are buckling under today’s tighter conditions. Some individual investors have lost six-figure sums and accuse the platform of downplaying the risks. At least one complaint filed with the SEC alleges Yieldstreet wasn’t transparent about how dangerous these investments could be. The company has reportedly halted its regular performance updates as it scrambles to contain the fallout. For the broader market, it’s a reminder that when the tide goes out, shaky projects get exposed – especially ones pitched to retail investors. It underscores the importance of rigorous due diligence and realistic assumptions, even when chasing high yields.

That’s all for now, but we’ll be back tomorrow. Don’t forget to hit follow or subscribe and leave a review to help others discover the show. I’m Michael—Until next time!

This is Deal Junkie. I’m Michael, it is 8:30 AM Eastern on Tuesday, August 19, 2025, here’s what we’re covering today: a surprise surge in apartment construction despite high interest rates, a billion-dollar bet on a Manhattan office tower, and a major landlord’s bankruptcy that signals stress in the multifamily sector.

First, a housing and construction update. Fresh government data out this morning showed new residential construction jumping in July, defying expectations. Groundbreakings on U.S. homes rose over 5% last month to about a 1.43 million annual pace, fueled largely by a boom in apartment projects. Developers put shovels in the ground for multi-family buildings at the fastest rate in two years, with new starts for buildings with 5+ units up by double digits. Single-family home starts also ticked up modestly for the first time in months. Now, this uptick comes despite mortgage rates being high – the 30-year fixed is still around 6.6%, roughly double what it was two years ago – which has kept many buyers and builders on edge. So why the surprise jump? Analysts say some builders are rushing projects forward, especially in the apartment space, anticipating that financing costs might ease soon. In fact, investors are increasingly betting the Federal Reserve will begin cutting interest rates as soon as next month, given some recent cooling in inflation and hiring. That hope has already nudged mortgage rates down from their peak, giving a small window of relief. But caution flags remain: permits for future construction actually fell in July to the lowest level in five years, largely because approvals for new apartment buildings dropped off. That suggests this burst of construction may not last unless borrowing costs come down further or demand really strengthens. For now, though, any positive momentum in housing is welcome news for the economy – residential construction had been a drag on growth earlier this year, so an upswing in building (especially rental housing) could boost investor sentiment. Keep an eye on whether lower financing costs and any Fed rate moves in the coming weeks can sustain this budding rebound.

Next, a big money move in the office market – something we haven’t heard in a while. New York City just logged its largest office deal of the year. Developer RXR Realty, led by Scott Rechler, has closed on the purchase of 590 Madison Avenue – the famed former IBM Building – along with two adjacent properties for a total price tag a little over $1 billion. That’s right, a billion-dollar bet on Manhattan office real estate at a time when the sector is under serious pressure. The seller was Ohio’s state teachers’ pension fund, which had owned the 590 Madison tower for years. At nearly one million square feet, 590 Madison is a trophy tower in Midtown, and RXR’s acquisition (at roughly $1.08 billion for all assets) signals that there is still an appetite for prime, well-located offices. It’s a bold move, arguably a sign of confidence that top-tier buildings can hold their value even as lesser offices struggle with vacancies. Remember, city office landlords have been facing a slew of challenges: higher interest rates, tenants downsizing with remote work, and steeper refinancing hurdles. We’ve seen distress and defaults picking up for older, half-empty office towers across the country. So this Manhattan mega-deal stands out. It suggests that for the cream-of-the-crop properties, buyers with deep pockets are willing to step in – likely at a discount to peak values – and bet on a long-term recovery. It might even set a pricing benchmark and coax other hesitant sellers or buyers off the sidelines. And it’s not just offices seeing selective optimism; in retail real estate, we’re also seeing big investment in specific niches. For example, on the West Coast, the owner of Saks Fifth Avenue just won a key city approval to redevelop its Beverly Hills flagship into a sprawling mixed-use complex with luxury retail, a hotel, offices and residences. In other words, while broad segments of office and retail are still finding their footing, investors are cherry-picking opportunities and doubling down on the locations and properties they believe will thrive in the long run.

Our third story highlights the growing stress in parts of the multifamily sector. Even though rentals have been a relatively resilient asset class, one of New York’s largest apartment owners has hit the wall financially. Last week, Joel Wiener – a prominent landlord who owns over 5,000 rental units in NYC – put a huge chunk of his portfolio into Chapter 11 bankruptcy. We’re talking 93 apartment buildings, many of them rent-stabilized units, now under court protection as Wiener’s firms seek to restructure roughly $1.1 billion in debt. So what happened? In short, a one-two punch of rising interest rates and tighter rent regulations. According to filings, many of these properties hadn’t paid their mortgages since January, after interest costs skyrocketed from around 3% to as high as 7–10% on certain loans. Rental income simply couldn’t cover the suddenly larger loan payments – especially because New York’s stricter rent control laws cap how much landlords can increase rents. Wiener’s team and his lender, Flagstar Bank, are now in a courtroom showdown. The bank alleges mismanagement and even questioned whether money that should go to mortgages was diverted elsewhere (since Wiener’s companies did manage to pay interest to some overseas bond investors). It’s a messy situation, and for investors, it’s a cautionary tale. Apartment buildings generally have been seen as safer bets, but even they aren’t immune to today’s high financing costs – particularly older rent-regulated portfolios with limited revenue growth. Observers note that other highly-leveraged landlords could be facing similar pressure, in New York and beyond, if they can’t refinance on workable terms. On the flip side, it’s worth noting that not all corners of commercial real estate are struggling. For instance, industrial properties like warehouses and data centers remain in hot demand – a new report even projects over $1 trillion in data center development will be needed by 2030 to keep up with tech growth, with vacancy rates in that niche near zero. And as mentioned, high-end retail and hospitality projects are still attracting investment. The takeaway for CRE investors? The landscape is extremely varied right now. Quality and location matter more than ever. While certain landlords are defaulting under the weight of higher interest rates, others are finding opportunity amid the tumult. It’s a time to be both vigilant and strategic.

That’s all for now, but we’ll be back tomorrow. Don’t forget to hit follow or subscribe and leave a review to help others discover the show. I’m Michael — until next time!

This is Deal Junkie. I’m Michael, it is 8:30 AM Eastern on Monday, August 18, 2025—here’s what we’re covering today: a surprise uptick in consumer confidence lifts retail sentiment; a major office-to-residential conversion plan gets city approval; and industrial land values begin to plateau after a multi-year boom.

First up, consumer mood is brightening. After months of soft sentiment, the latest confidence index bounced back sharply this week—hitting the highest level since early 2024. Retailers are taking note: auto sales and in-store foot traffic both showed modest gains over the weekend. That renewed optimism is a boon for retail real estate, especially shopping centers and lifestyle strips. Landlords are already reporting fewer vacancies and a slight uptick in rent renewals, especially in suburban and drive-to locations. Investors in retail and mixed-use centers should take note—demand is coming back, at least for now, in the physical marketplace.

Next, a landmark rezoning could reshape office real estate in Los Angeles. The city just approved a plan to convert a large, mostly vacant downtown office complex into a mixed-use development, including residential units, retail, and green space. The developer is planning upwards of 400 new apartments above ground-floor retail, transforming an underused campus into a vibrant urban block. This is emblematic of a growing trend: aging office assets in high-cost markets are being reimagined as housing or hybrid developments. That puts a real floor under values for older office inventory—but also raises the competitive bar for newer properties vying to remain purely commercial. For office investors, this underscores dual strategies: either reposition assets for new uses or double down on ones built for the future.

Now for an update on industrial real estate—after years of explosive growth, the pace of land value increases is finally slowing. Major markets like Atlanta, Dallas, and Phoenix all reported that vacant land zoned for logistics is still commanding premium prices, but price growth has cooled to a 3–4% annual pace—well under the double-digit jumps we saw recently. Analysts say this reflects a shift toward a normalizing market as developers catch up with multiyear demand. That’s a healthy reset—overheated land prices are dropping, while occupiers can still find space. For investors, industrial fundamentals remain strong (leases and tenants are stable), but underwriting models need to adjust. Investors should look for well-located, stabilized assets rather than speculative greenfield developments.

On the macro side, the consumer price index for July came in slightly above expectations—but core inflation remains under 3%. And while job growth was modest, wage pressures are softening, giving the Fed room to stay on hold. The Fed said in a public call it sees inflation progress, but not enough to signal a rate cut just yet. Markets continue to expect a cut in late September or October. For real estate investors, that means financing rates may hold steady in the near term—but there remains reasonable odds for relief by year-end, which could help deals and refinancing.

For CRE investors today: Retail sentiment is recovering, repositions and conversions are gaining momentum, and industrial fundamentals are shifting toward moderation. Keep an eye on the Fed—rate relief may be coming, but patience is required in the interim.

That’s all for now, but we’ll be back tomorrow. Don’t forget to hit follow or subscribe and leave a review to help others discover the show. I’m Michael—Until next time!

This is Deal Junkie. I’m Michael, It is 8:30 AM Eastern on Thursday, August 15, 2025, here’s what we’re covering today: a surprise inflation jump collides with a cooling job market; major moves by industry giants from Brookfield to Altus Group; and Sunbelt apartments face oversupply while retail centers shine.

We start with the economy. New data is painting a mixed picture right now. U.S. wholesale prices jumped nearly 1% in July, the biggest monthly spike in inflation in three years – a shock blamed on rising import costs from new tariffs. But at the same time, the job market is finally cooling off: hiring has slowed sharply this summer.

So the Federal Reserve finds itself pulled in two directions – inflation is running a bit hot again, but growth is clearly cooling. Up until this week many on Wall Street were banking on an interest rate cut as soon as next month. Now that’s much less of a sure thing. Fed officials are reportedly split over whether high inflation or slow growth is the bigger worry. For real estate investors, that means uncertainty: a rate cut would lower financing costs and boost property values, whereas stickier inflation could keep borrowing costs higher for longer.

Next, some major moves by industry giants making waves. Brookfield, one of the world’s largest property owners, reports that its real estate arm is finally rebounding from last year’s losses. In the second quarter, Brookfield’s property division lost about $46 million – still a loss, but a world of difference from the nearly $800 million it lost in the same quarter a year ago. This turnaround comes as some of Brookfield’s investment funds booked gains and its borrowing costs eased a bit. It’s an encouraging sign, though Brookfield admits its office buildings are still struggling with high vacancies.

Meanwhile, Altus Group – the company behind the Argus real estate software – announced it’s exploring a sale after drawing strong interest from private equity. That shows there’s serious money eager to invest in the tech that powers real estate. If Altus is acquired, it would mark one of the biggest proptech shake-ups in recent memory.

Finally, we’re seeing a growing divide across property types. On the downside, multifamily and office are under pressure. In parts of the Sunbelt, years of rapid apartment construction have created a glut, especially in Florida, where rents are now dipping year-over-year as new units flood the market. Landlords are offering concessions, and some developers are even putting projects up for sale. Offices, meanwhile, remain the most troubled sector. Older downtown towers in many cities are suffering high vacancies and falling values, with some owners walking away from properties. But it’s not all doom and gloom – top-tier office buildings are still landing tenants who want quality space. In Charlotte, a new office tower just landed a major bank as its anchor tenant, showing that prime offices in growth markets can still draw interest.

On the upside, retail and industrial real estate are holding strong. Open-air shopping centers have high occupancy and rising rents, thanks to steady consumer spending and very limited new development in that segment. Modern warehouses remain in high demand thanks to e-commerce. The warehouse boom isn’t as frenetic as it was a couple of years ago, but well-located distribution centers are still seeing healthy leasing activity. Investors are favoring those steadier retail and industrial assets and staying cautious on offices and oversupplied apartment markets.

That’s all for now, but we’ll be back tomorrow. Don’t forget to hit follow or subscribe and leave a review to help others discover the show. I’m Michael—Until next time!

This is Deal Junkie. I’m Michael, it is 8:30 AM Eastern on Wednesday, August 14, 2025, here’s what we’re covering today: record apartment demand tightens the rental market, Florida axes a decades-old tax on commercial leases, and cooling inflation boosts hopes for lower interest rates.

Multifamily Comeback: The U.S. apartment sector is roaring back. New data out this morning show renters absorbed more units last quarter than in any second quarter on record. For a fifth straight quarter, demand exceeded new supply, pushing the national apartment vacancy down to roughly 4% – the lowest in years. Landlords are finally regaining some pricing power: average rents just saw their first meaningful uptick in two years. With fewer projects breaking ground now, this tight market dynamic is expected to continue into 2026. Investors have noticed as well – multifamily led all property types in sales volume last quarter. It’s a stark turnaround from the soft conditions of a year ago, and a sign that fundamentals have dramatically strengthened.

Florida Ends Commercial Rent Tax: Florida is scrapping a unique tax that no other state charges – its 2% levy on commercial leases. Come October 1st, that 55-year-old tax will be history, effectively giving every office, retail, and industrial tenant in Florida a 2% rent cut. For a business paying $100,000 a month in rent, that’s an extra $24,000 a year kept in their pocket. This change gives tenants serious savings and gives Florida a new competitive edge in attracting companies. It’s expected to further boost leasing demand, especially in Florida’s already tight warehouse and retail markets. Office landlords, who have struggled with high vacancies, hope the tax break will entice more firms to relocate or expand in the state. Some landlords might try to raise base rents to offset the lost tax, but in a competitive market tenants will insist on keeping the savings. Overall, this rare tax repeal is a clear tailwind for Florida’s commercial real estate – lowering occupancy costs, potentially lifting property values, and offering another incentive for investors to pour into Florida’s booming markets.

Cooling Inflation, Rate Cut Buzz: On the economic front, new data may finally give the Fed cover to ease up on interest rates. Consumer prices in July rose at their slowest pace in years – just about 2.7% year-over-year. Core inflation is a bit higher but trending down as well, and the job market has cooled considerably. As a result, Wall Street is betting rate cuts could happen sooner rather than later. In fact, markets now see good odds the Federal Reserve might cut rates as soon as next month. For real estate, that would be a game-changer. After a year of punishing borrowing costs that stalled many deals, even a hint of lower rates is lifting sentiment. Some developers are already revisiting stalled projects, anticipating cheaper financing ahead. Sectors that depend on financing for growth – like apartments and retail development – would get some much-needed breathing room. Now, it’s not a done deal: if the Fed thinks inflation isn’t fully tamed or sees other red flags, they could hold off. And remember, a rate cut would likely mean the economy is slowing, which isn’t great for tenant demand. But for now, the mere prospect of an early Fed pivot has put a spring in the market’s step. Real estate investors are hoping easier money will unlock deals and help stabilize property values by year-end.

That’s all for now, but we’ll be back tomorrow. Don’t forget to hit follow or subscribe and leave a review to help others discover the show. I’m Michael—Until next time!

This is Deal Junkie. I’m Michael, it is 8:30 AM Eastern on Wednesday, August 13, 2025, here’s what we’re covering today: leasing is surging as major CRE firms turn bullish; affordable housing support lifts multifamily optimism; and cooling inflation has the Fed poised to cut rates.

First up, commercial real estate is showing clear signs of a comeback. Several of the biggest brokerage firms posted strong second-quarter results and raised their full-year forecasts for the first time since 2020. This rebound is being fueled by a surge in leasing activity across sectors. In offices, tenants are chasing top-tier “trophy” space again – and even well-located second-tier buildings are benefiting as companies like JPMorgan and Amazon enforce return-to-office mandates. Industrial real estate is also seeing big moves: Terreno Realty just paid $233 million for nine Seattle warehouses in one of this year’s largest industrial acquisitions, a sign of confidence in the logistics sector. Now, high interest rates and a slowing economy are still potential speed bumps for deal-making. But after years of caution, sentiment is much more upbeat. Many in the industry feel we’re in the early innings of a real recovery, with landlords and tenants finally ready to make long-term commitments again.

Shifting to housing, new federal support is boosting confidence in the multifamily sector. A law passed last month effectively doubled Fannie Mae and Freddie Mac’s capacity to finance affordable housing, adding billions in potential funding for low-income apartment projects. Developers say this policy jolt has lifted their outlook – a national builder sentiment index for multifamily ticked up in the second quarter, led by optimism around subsidized units. The extra government backing could help get more projects off the ground that previously didn’t pencil out. Still, it’s not all smooth sailing. High construction costs, pricey financing, and strict zoning rules are still holding development back. Even tech giants that pledged huge sums for housing have been stymied by permitting delays in places like California – proving money alone can’t fix the housing crunch overnight. The bottom line: momentum is building to add more housing supply, and over time that should bolster the multifamily market. But patience is key – these projects will take time to materialize, and investors will need to navigate the hurdles along the way.

And finally, on the macro front, the latest economic data is tipping in favor of real estate investors. Inflation in July came in around three percent – way down from the peaks of the past couple years. With price growth finally moderating and the job market cooling, the Federal Reserve looks likely to ease up on interest rates. In fact, markets are now almost fully pricing in a rate cut at the Fed’s meeting next month. Some officials in Washington are even pushing for an extra-large half-point cut, given the recent weak employment reports. Any cut would be the first in well over a year and mark a major policy shift. For the CRE world, lower rates can’t come soon enough. Cheaper debt would help revive deal activity and refinancing that have been frozen by high borrowing costs. Of course, a Fed rate cut also signals the economy might be losing steam, so it’s a mixed blessing. But right now, just the expectation of falling rates is improving investor sentiment across property markets after a long stretch of tightening.

That’s all for now, but we’ll be back tomorrow. Don’t forget to hit follow or subscribe and leave a review to help others discover the show. I’m Michael—until next time!

This is Deal Junkie. I’m Michael, it is 8:30 AM Eastern on Tuesday, August 12, 2025. Here’s what we’re covering today: inflation comes in cool, sparking talk of Fed rate cuts; office attendance is rising as some investors wade back in; and a billion-dollar data center deal highlights the strength of industrial real estate.

First up, the inflation picture. New data shows consumer prices running at 2.7% annually in July – essentially flat from June – with just a 0.2% increase on the month. Inflation is finally in the Federal Reserve’s target zone, and investors are hopeful the Fed might begin cutting interest rates in the coming months. Treasury yields even dipped on the news as traders anticipate less need for Fed tightening. But one Fed official today urged caution, noting inflation is still a bit above goal and the economy remains resilient, so he favors holding rates steady for now. The bottom line? The era of Fed rate hikes appears to be over, and the prospect of stable or even lower borrowing costs ahead is a big relief for real estate dealmakers after a year of sky-high financing costs.

Turning to the office sector, there are clear signs that employees are heading back to workplaces – and it’s slowly shifting companies’ real estate plans. A new survey finds 72% of large firms now meet their office attendance targets, up from 61% last year. The average employee is coming in nearly three days a week. That’s still not five days, but definitely more than during the height of remote work. As staff return, many companies are rethinking space cuts. Roughly two-thirds of employers now plan to keep or even expand their office space, reversing the widespread downsizing expected last year. It’s tentative good news for landlords of quality buildings. And even investors are tiptoeing back in. In one notable deal, Apollo Global just snapped up a 286,000-square-foot office tower in Houston – likely at a discount. The fact that a big player is bargain-hunting offices again suggests some see opportunity brewing in select markets after a long dry spell.

Meanwhile, industrial real estate – including its high-tech cousin, data centers – continues to draw huge investment. In Houston, a massive 62-acre logistics park called TriPort 8 will add nearly 900,000 square feet of warehouse space across five buildings. The project is backed by Alliance Industrial and Northwestern Mutual, showing that major capital remains keen on expanding distribution hubs. And in Georgia, data center operator DC Blox just secured a whopping $1.15 billion financing package to build a new campus near Atlanta. That’s one of the largest construction loans in recent memory, underlining red-hot demand for server space driven by the cloud and AI boom. In short, even as some property sectors have cooled, warehouses and digital infrastructure are still attracting big bets – thanks to surging e-commerce and an insatiable appetite for data.

One quick note on multifamily: Apartment construction has fallen to its lowest level since 2015, after a record boom two years ago. With far fewer projects breaking ground now due to high costs and tight credit, new supply is shrinking dramatically – markets like Austin and Phoenix have seen building activity plummet. That could tighten rental markets down the line, which is something apartment investors will be watching.

That’s all for now, but we’ll be back tomorrow. Don’t forget to hit follow or subscribe and leave a review to help others discover the show. I’m Michael — until next time!