The CRE Investment Climate Just Changed

Is this a turning point for CRE markets?​

Capital Targeting CRE Investment Increasing​

• Pent-up dry powder being deployed into CRE assets ​

• Asset performance remains healthy, aside from some office segments ​

Yield Spread Widening Across CRE Sectors ​

• The average overall CRE cap rate rose 90 basis points since 2022, to 6.7% ​

• The gap between the 10-year treasury and CRE cap rates expanded to its widest level since 2022 ​

Cost of Debt Capital Coming Down ​

• The probability of a September rate cut by the Fed is a near certainty according to Wall Street ​

• Lenders are beginning to reduce their spreads over the basis as the risk of rate increases diminishes ​

• Share of lenders tightening their lending standards at lowest level since the second quarter of 2022​

*Through August 14​
Sources: Marcus & Millichap Research Services, CoStar Group, Inc., Real Capital Analytics, Federal Reserve​

​​Watch Video Below: