Question 3
What has surprised you most about the CRE market in ’24 to date?
Financing | Los Angeles | Male | 12 Years in CRE
Lack of distressed transactions and overall resiliency in the market. We were under the impression something may have broken by now.
Multifamily| Atlanta | Male | 40 Years in CRE
The lack of real stress in the CRE debt market. Thus far, there has been a surprising tendency for banks to “blend and extend,” thereby kicking the can down the road for the second half of 2024 or the first half of 2025.
Primarily Condo and Multifamily | South Florida | Male | 20 Years in CRE
I have been most surprised by the lack of distress, especially in overleveraged assets. I would have assumed that the lack of money flow would have resulted in more deeply discounted opportunities presenting themselves; however, owners and lenders have been quite patient with one another. Perhaps this has to do with the large amount of capital sitting on the sidelines, as evidenced by the overwhelming amount of bids for any assets with a distressed story of any kind.
Financing | New Jersey | Male | 26 Years in CRE
What has surprised me most about the CRE market in '24 is the persistent demand for long-term capital despite economic uncertainties. During Covid, many turned to PPP lending, but there remains a crucial role for long-term capital in supporting infrastructure and affordable housing projects. While some sectors may struggle cyclically, the resilience of long-term investments underscores their enduring value in stabilizing and growing our economy, supporting small businesses and fostering sustainable development.
Development | Washington, D.C. | Male | 25 Years in CRE
I am surprised that we have not seen more banking issues, particularly with regional lenders.
Retail Investment, Leasing | Atlanta | Male | 18 Years in CRE
Honestly, nothing. This year has gone exactly as anticipated, other than I was expecting to see a bit more REO, which is yet to happen outside of office.
Lending, Debt Management, Origination | San Francisco | Male | 20 Years in CRE
The magnitude of the compression in loan spreads and the depth of the lending market at those tighter spreads for multifamily and industrial acquisitions with cash flow.
Brokerage | Chicago | Female | 16 Years in CRE
What has surprised me most about the commercial real estate market in 2024 is the resilience and adaptability of the industry. Despite ongoing economic challenges and high interest rates, I've seen innovative solutions and strategic pivots across the board. Tenants and landlords alike have shown remarkable flexibility, and there's been a surprising surge in demand for sustainable and tech-integrated properties, signaling a shift in market priorities and long-term planning.
Multifamily Investment | Chicago | Female | 20 Years in CRE
I have seen a tremendous slowdown in purchases of smaller commercial spaces, while larger purchases seem to not have been affected as much. Rentals have decreased as well, and I feel it's due to less brick-and-mortar small businesses opening and more online startups.
Retail | Pan-European | Male | 35 Years in CRE
Nothing particular, except how keen people are to see a rebound in prices, to the extent they feel they can magic lower yields just by clicking their heels together three times. Wishful thinking, blind naivety or healthy optimism?
Capital Markets | National | Female | 30 Years in CRE
Given the challenging environment, one would think that CMBS delinquencies would be much higher. I suspect that’s testimony to not only the conservative loan underwriting we’ve seen during the last several years and the collaborative efforts by both loan servicers and borrowers to work together to find solutions.
Multifamily Development, Investment | Washington, D.C. | Male | 15 Years in CRE
The most surprising aspect has been the persistent bid-ask gap, with more than two-thirds of deals listed not transacting. To address this, we developed a unique strategy to incentivize sellers by offering them an upside participation at the time of our fund redemption, and providing brokers with additional revenue opportunities since transaction volume is down.
Industrial | Southern California | Male | 21 Years in CRE
We are actually pleasantly surprised that 2024 is outperforming our (conservative) projection for the first half of the year. We see life in the office sector beyond what we had forecasted and well beyond what we saw last year. Meanwhile, we have seen softening of the industrial sector, including a spike in the sublease market. Not doom and gloom, and the fundamentals are still very strong — just a normalization after a hyperinflated past several years. Also, manufacturing is a surprise, as we are tracking it to be the fastest-growing sector for industrial absorption this past year.
Lastly, Amazon is the surprise. After announcing just two years ago that they were pulling back a little, 2024 is on track to be one of the highest years of new absorption. Interesting times, and still many opportunities.
Brokerage | Los Angeles | Male | 20 Years in CRE
The number of deals that transact on an off-market basis compared to a widely marketed process. Many times, you will see a deal come to market, not achieve pricing expectations, and the seller decides to hold the asset. A few buyers will hang around the hoop, stay in communication with the broker or seller and get the deal done on an off-market basis.
Office | Houston | Male | 42 Years in CRE
I never thought I could buy a downtown building in Houston on a full block of land that is tunnel-connected for under $10M.
National Business Development | Houston | Male | 30 Years in CRE
Some of the toughest, hardest-hit markets are showing unusual signs of life, like San Francisco. Our activity is surprisingly strong from the last two years.
Office Tenant Representation | Denver | Male | 18 Years in CRE
The disconnect between publication headlines and quoted general overall market statistics vs. the reality of office market demand. Quality product in desirable locations is competitive. Many companies are mentally unprepared for this based on their read of negative headlines on office in general. There are certainly troubled buildings and areas, but the high-demand story is not being covered well.
Investment Sales | Houston | Male | 11 Years in CRE
Continued rental growth in certain market sectors has surprised me the most this year. Certain markets across the United States that experienced substantial rental growth from 2020-2022 are now experiencing challenges other markets faced during that same period. Despite this, buyers are motivated to purchase deals in those markets, albeit somewhat opportunistically.
Development | Washington, D.C. | Male | 23 Years in CRE
I am surprised as to the large-scale, well-capitalized development firms that I have witnessed that had to significantly downsize, eliminate verticals within their companies, and in some instances close their shops. I have also been surprised that you have been unable to make development deals pencil in some markets even with free land. I am also surprised as to the complete shift in the office market that appears to be here to stay. Office developers have to completely rethink their strategies while cities are faced with the new challenge of what to do with the highly vacant downtown office buildings that impact retail and its vibrancy.
Affordable Housing | Atlanta | Female
Housing affordability isn’t really budging despite higher interest rates. Apartment and single-family home prices have been resilient — but the year is not over yet!
Office and Industrial Tenant Representation | Houston | Male | 15 Years in CRE
The most striking development in 2024 has been the integration and impact of AI within the CRE market. Additionally, the sustained economic activity, despite expectations of a downturn, was unexpected. These factors underscore a dynamic market that continues to evolve unpredictably.
Development, Investment | Chicago | Male | 16 Years in CRE
I’ve been happily surprised by the resilience of the U.S. economy despite rate hikes. The other side of that coin has been a prolonged higher interest rate environment. From a demand standpoint, traditional industrial users have been slower than I expected in making new leasing decisions. I think the biggest surprise was the introduction of ChatGPT and the surge in demand for advanced manufacturing and data centers.
Development | Washington, D.C. | Female | 30 Years in CRE
It is interesting to see how a very large segment of people are holding on through these tough times to jobs, and office buildings and projects that are stressed. May be a sign of resiliency.
Industrial | New York | Male | 15 Years in CRE
We are finding that many property owners took advantage of the low rate environment during 2020-2022 and refinanced. As a result of their low rates and increasing rents, their properties are cash flowing very well and they are not inclined to sell, even for aggressive numbers. We are not surprised by the scenario, but have been surprised by how many owners it applies to.
Finance, Venture Capital | Atlanta | Male | 20 Years in CRE
I'm not incredibly surprised — the market is just doing what the market does. What would surprise me is if transaction volume reached, you know, pre-pandemic levels. If transaction activity, like buying and selling, was back up to 2019-2021 levels without a massive drop in prices, that would surprise me.
Office, Medical, Retail and Industrial | Dallas | Female | 13 Years in CRE
I have been pleasantly surprised with the level of activity that has remained consistent this year. Deals have been small but steady in 2024 across all asset classes!
REITs | Washington, D.C. | Male | 24 Years in CRE
The negative overreaction to everything office.
Residential Brokerage | New York | Female | 35 Years in CRE
What has surprised me most about the CRE market in 2024 is the alarming number of unscrupulous brokers who have resorted to devious and outright uncivilized behavior toward their clients and colleagues. It seems that ethics have become a luxury in today's market. The intense competition for the few available deals has turned it into a survival fight, often at the expense of professional integrity.
Brokerage | Washington, D.C. | Female | 36 Years in CRE
That while we are several years out from the horror of the pandemic, things still aren’t great. Office space occupiers are still struggling with what their respective policies are on requirements for being in the office. The impact of interest rates requires us to find new ways to get deals done. And it is reflective of the times that the best amenity during these days of amenity wars is a well-capitalized owner who can transact.
Corporate Real Estate | Houston | Male | 43 Years in CRE
What has surprised me the most is my clients’ increasing appetite for all types of space. The other thing that has surprised me is the number of office buildings facing an uncertain future. Loans are coming due and yet there is no clear path for a change in ownership and control. Most lenders are not prepared to take the buildings back, there is limited capital to fund transaction costs (tenant improvements and commissions), and there are very few buyers and lenders to acquire the buildings and reposition them. They are stuck. The result is a bifurcated office market with misleading vacancy rates. I believe most of the vacant space is in buildings that do not have the ability to transact, and that creates misleading marketwide vacancy rates.
Office | Washington, D.C. | Female | 25 Years in CRE
Despite headlines around overall market vacancy, there’s very healthy demand for well-located, premium spaces, particularly for larger tenants (100K RSF-plus). Occupier activity since the beginning of 2024 has been encouraging, and return-to-office metrics have steadily improved. Occupiers are engaged and continue to invest and upgrade their spaces. The top-down tightening trend is starting to shift leverage on an asset-by-asset basis toward the investor's benefit. Meanwhile, the commodity and more aged inventory set continues to struggle.
Office | Philadelphia | Male | 20 Years in CRE
How firmly new hybrid and workweek patterns have taken root.
Office, Industrial, Land | San Antonio | Male | 44 Years in CRE
Didn’t expect the industrial developers to keep building given demand slowed/stopped last year. Bit surprised that multifamily occupancies and rents have held up despite lots of new supply, but that will keep coming for a while here in San Antonio. Thought we would see more office distress, but so far, little or none in San Antonio.
Retail | Houston | Male
The ongoing shrinkage of availabilities in the market pertaining to quality retail and the amount of planned mixed-use developments that are going toward more suburban markets.
Development, Investment | Washington, D.C. | Female | 15 Years in CRE
I’m surprised that CRE layoffs have not been more widespread given transaction pacing and economic conditions.
Office, Multifamily, Hotel Investment, Development | Denver | Male | 24 Years in CRE
I thought more multifamily investors that bought at the peak, that overlevered and used floating-rate debt, would have capitulated by now.
Life Sciences, Industrial, Multifamily | Boston | Male | 20 Years in CRE
I anticipated a busier first half of the year given the uncertainty surrounding the election in November. A very narrow deal profile is generating buyer interest, and everything else is a real struggle.
Investment | National | Male | 25 Years in CRE
The level of distress for office in primary markets, first-tier cities such as NY, San Francisco, LA and Chicago, are all quite staggering and surprising. There is very little positive news. The headlines of these office markets falling off a cliff in these “go-to” markets has, in turn, tainted all office markets nationally, regardless of the health of the individual local markets. So, I’m further surprised that South Florida has remained so resilient and is in high demand by national and international investors and tenants. It bodes well for the region.
Private Equity Investment | London | Male | 20 Years in CRE
Positive: The resilience of tenant demand in the office market, especially for the B buildings in A locations. Every PERE-like article tells you tenants will choose the A buildings if forced to make a budget-driven choice, which would suggest strong demand for A buildings in B locations. That’s not correct. Tenant demand is stronger (anecdotally for us) in the A locations even if the tenant has to compromise on the building quality/ESG/sustainability.
Negative: The continued lack of core/core-plus capital in the market that really generates most of the market liquidity for stabilised assets.
Office Redevelopment | Dallas, Denver | Male | 31 Years in CRE
The strength of the leasing market for spaces below 5K SF. You are getting pressure from larger companies that are downsizing into this segment and also demand from Covid side hustles that are becoming real businesses and need small spaces. Everyone is talking about a flight to quality, but we are seeing a “flight to value” in this segment. If you are the lowest lease rate in this market, you will fill up quickly.
Multifamily, Industrial, Self-Storage, Manufactured Housing | Dallas | Male | 30 Years in CRE
Very little, other than the headlines, which say things are terrible. But outside of office and some urban environments, that is simply not the case. The higher rates affect everyone, but the amount of distress and challenges are overstated outside of the office sector.
Proptech | Los Angeles | Male | 18 Years in CRE
Many — including our team at times — had predicted a greater recovery by this point. The abundance of wealth and capital on the sidelines has remained disciplined (i.e., not jumping into deals that don’t pencil out) and recovery has taken longer than anticipated. Ultimately, this might be a good thing, as taking our medicine for longer may result in a smoother and more robust recovery long-term.
Affordable Housing | New York | Male | 23 Years in CRE
My biggest surprise in ‘24 was that a housing deal got done in Albany. I had expected it to go for at least another year. Looking to see how the new programs on production and tenant protections actually play out.
Retail | New York City | Male | 17 Years in CRE
I don't know if it surprised me, but it’s pleasant. Subway stations are packed. The Midtown deli, where people are waiting for lunch on a Tuesday, is slammed. At Starbucks, there’s a line around the corner. A lot of that speaks to New York coming back to the way that it always has been traditionally.
Job Recruiting | National | Female | 10 Years in CRE
I thought we would experience a little bit more of a return to normal and that things would be more predictable than they had been the last several years. I'm most surprised that the trends and the patterns and the rhythms of this business that I've been so immersed in for the last 10 years are still so unpredictable and unexplainable. I would have expected things to be a little bit closer to pre-Covid this year, and it's continued to get weirder and weirder.
Retail | Chicago | Female | 26 Years in CRE
The resiliency of the consumer. We are a 75% retail portfolio. Consumers have become more careful but are still spending.
Office | San Francisco | Male | 15 Years in CRE
The exciting thing about the office market is more tenants are in the market; however, they are taking a long time to make decisions about space.
Self-Storage Investor | Albuquerque | Male | 20 Years in CRE
Some community banks have returned to lending on development. It's their time to make money. The deals they are seeing today are fantastic deals. If a deal works at 55% loan-to-cost at 9% interest, it's going to be solid.
Multifamily | Washington, D.C. | Male | 20 Years in CRE
The resiliency of the consumer and American renter. In the face of heavy supply, the rental market has remained strong, in part because jobs have held up and renters are staying longer in the renter pool due to the increased cost of homeownership.
Legal | New York | Male | 30 Years in CRE
I have been surprised most by the relative calm and rationality demonstrated by all CRE players (lenders, borrowers, buyers, sellers) — there seems to be clarity and agreement on the way these players view the market and thus the basis upon which actions and decisions are being made. I believe the next six to 12 months will be an important period for defining the scope and depth of CRE’s recovery and whether the uptick we are seeing in the second quarter of 2024 manifests any long-term strength and recovery in the CRE sector overall.
Multifamily | Brooklyn | Male | 21 Years in CRE
I’m not really surprised by the market today. Since the passing of the 485X and Good Cause, we have seen more activity in the market, but this was expected. We were hoping for a few interest rate cuts to kick-start more transaction volume, but our expectations were that 2024 would be a slow thawing-out year and that 2025 and 2026 could be the start of a new upward cycle.
Office Brokerage | Washington, D.C. | Male | 27 Years in CRE
The D.C. government's building tax assessments do not align with current market conditions, despite a significant decline in property values and sales comparables showing losses exceeding 40%. This discrepancy highlights the need for an adjustment to accurately reflect the true value of properties in the District. Despite these clear trends, the District appears to be overlooking this critical issue amidst a substantial budget deficit. In office leasing, tenants are increasingly concerned about landlords' financial stability as a result of the challenges in the market. With a significant number of landlords facing financial strain, there has been a surge in lenders reclaiming assets.
Financing | Los Angeles | Male | 12 Years in CRE
Lack of distressed transactions and overall resiliency in the market. We were under the impression something may have broken by now.
Multifamily| Atlanta | Male | 40 Years in CRE
The lack of real stress in the CRE debt market. Thus far, there has been a surprising tendency for banks to “blend and extend,” thereby kicking the can down the road for the second half of 2024 or the first half of 2025.
Primarily Condo and Multifamily | South Florida | Male | 20 Years in CRE
I have been most surprised by the lack of distress, especially in overleveraged assets. I would have assumed that the lack of money flow would have resulted in more deeply discounted opportunities presenting themselves; however, owners and lenders have been quite patient with one another. Perhaps this has to do with the large amount of capital sitting on the sidelines, as evidenced by the overwhelming amount of bids for any assets with a distressed story of any kind.
Financing | New Jersey | Male | 26 Years in CRE
What has surprised me most about the CRE market in '24 is the persistent demand for long-term capital despite economic uncertainties. During Covid, many turned to PPP lending, but there remains a crucial role for long-term capital in supporting infrastructure and affordable housing projects. While some sectors may struggle cyclically, the resilience of long-term investments underscores their enduring value in stabilizing and growing our economy, supporting small businesses and fostering sustainable development.
Development | Washington, D.C. | Male | 25 Years in CRE
I am surprised that we have not seen more banking issues, particularly with regional lenders.
Retail Investment, Leasing | Atlanta | Male | 18 Years in CRE
Honestly, nothing. This year has gone exactly as anticipated, other than I was expecting to see a bit more REO, which is yet to happen outside of office.
Lending, Debt Management, Origination | San Francisco | Male | 20 Years in CRE
The magnitude of the compression in loan spreads and the depth of the lending market at those tighter spreads for multifamily and industrial acquisitions with cash flow.
Brokerage | Chicago | Female | 16 Years in CRE
What has surprised me most about the commercial real estate market in 2024 is the resilience and adaptability of the industry. Despite ongoing economic challenges and high interest rates, I've seen innovative solutions and strategic pivots across the board. Tenants and landlords alike have shown remarkable flexibility, and there's been a surprising surge in demand for sustainable and tech-integrated properties, signaling a shift in market priorities and long-term planning.
Multifamily Investment | Chicago | Female | 20 Years in CRE
I have seen a tremendous slowdown in purchases of smaller commercial spaces, while larger purchases seem to not have been affected as much. Rentals have decreased as well, and I feel it's due to less brick-and-mortar small businesses opening and more online startups.
Retail | Pan-European | Male | 35 Years in CRE
Nothing particular, except how keen people are to see a rebound in prices, to the extent they feel they can magic lower yields just by clicking their heels together three times. Wishful thinking, blind naivety or healthy optimism?
Capital Markets | National | Female | 30 Years in CRE
Given the challenging environment, one would think that CMBS delinquencies would be much higher. I suspect that’s testimony to not only the conservative loan underwriting we’ve seen during the last several years and the collaborative efforts by both loan servicers and borrowers to work together to find solutions.
Multifamily Development, Investment | Washington, D.C. | Male | 15 Years in CRE
The most surprising aspect has been the persistent bid-ask gap, with more than two-thirds of deals listed not transacting. To address this, we developed a unique strategy to incentivize sellers by offering them an upside participation at the time of our fund redemption, and providing brokers with additional revenue opportunities since transaction volume is down.
Industrial | Southern California | Male | 21 Years in CRE
We are actually pleasantly surprised that 2024 is outperforming our (conservative) projection for the first half of the year. We see life in the office sector beyond what we had forecasted and well beyond what we saw last year. Meanwhile, we have seen softening of the industrial sector, including a spike in the sublease market. Not doom and gloom, and the fundamentals are still very strong — just a normalization after a hyperinflated past several years. Also, manufacturing is a surprise, as we are tracking it to be the fastest-growing sector for industrial absorption this past year.
Lastly, Amazon is the surprise. After announcing just two years ago that they were pulling back a little, 2024 is on track to be one of the highest years of new absorption. Interesting times, and still many opportunities.
Brokerage | Los Angeles | Male | 20 Years in CRE
The number of deals that transact on an off-market basis compared to a widely marketed process. Many times, you will see a deal come to market, not achieve pricing expectations, and the seller decides to hold the asset. A few buyers will hang around the hoop, stay in communication with the broker or seller and get the deal done on an off-market basis.
Office | Houston | Male | 42 Years in CRE
I never thought I could buy a downtown building in Houston on a full block of land that is tunnel-connected for under $10M.
National Business Development | Houston | Male | 30 Years in CRE
Some of the toughest, hardest-hit markets are showing unusual signs of life, like San Francisco. Our activity is surprisingly strong from the last two years.
Office Tenant Representation | Denver | Male | 18 Years in CRE
The disconnect between publication headlines and quoted general overall market statistics vs. the reality of office market demand. Quality product in desirable locations is competitive. Many companies are mentally unprepared for this based on their read of negative headlines on office in general. There are certainly troubled buildings and areas, but the high-demand story is not being covered well.
Investment Sales | Houston | Male | 11 Years in CRE
Continued rental growth in certain market sectors has surprised me the most this year. Certain markets across the United States that experienced substantial rental growth from 2020-2022 are now experiencing challenges other markets faced during that same period. Despite this, buyers are motivated to purchase deals in those markets, albeit somewhat opportunistically.
Development | Washington, D.C. | Male | 23 Years in CRE
I am surprised as to the large-scale, well-capitalized development firms that I have witnessed that had to significantly downsize, eliminate verticals within their companies, and in some instances close their shops. I have also been surprised that you have been unable to make development deals pencil in some markets even with free land. I am also surprised as to the complete shift in the office market that appears to be here to stay. Office developers have to completely rethink their strategies while cities are faced with the new challenge of what to do with the highly vacant downtown office buildings that impact retail and its vibrancy.
Affordable Housing | Atlanta | Female
Housing affordability isn’t really budging despite higher interest rates. Apartment and single-family home prices have been resilient — but the year is not over yet!
Office and Industrial Tenant Representation | Houston | Male | 15 Years in CRE
The most striking development in 2024 has been the integration and impact of AI within the CRE market. Additionally, the sustained economic activity, despite expectations of a downturn, was unexpected. These factors underscore a dynamic market that continues to evolve unpredictably.
Development, Investment | Chicago | Male | 16 Years in CRE
I’ve been happily surprised by the resilience of the U.S. economy despite rate hikes. The other side of that coin has been a prolonged higher interest rate environment. From a demand standpoint, traditional industrial users have been slower than I expected in making new leasing decisions. I think the biggest surprise was the introduction of ChatGPT and the surge in demand for advanced manufacturing and data centers.
Development | Washington, D.C. | Female | 30 Years in CRE
It is interesting to see how a very large segment of people are holding on through these tough times to jobs, and office buildings and projects that are stressed. May be a sign of resiliency.
Industrial | New York | Male | 15 Years in CRE
We are finding that many property owners took advantage of the low rate environment during 2020-2022 and refinanced. As a result of their low rates and increasing rents, their properties are cash flowing very well and they are not inclined to sell, even for aggressive numbers. We are not surprised by the scenario, but have been surprised by how many owners it applies to.
Finance, Venture Capital | Atlanta | Male | 20 Years in CRE
I'm not incredibly surprised — the market is just doing what the market does. What would surprise me is if transaction volume reached, you know, pre-pandemic levels. If transaction activity, like buying and selling, was back up to 2019-2021 levels without a massive drop in prices, that would surprise me.
Office, Medical, Retail and Industrial | Dallas | Female | 13 Years in CRE
I have been pleasantly surprised with the level of activity that has remained consistent this year. Deals have been small but steady in 2024 across all asset classes!
REITs | Washington, D.C. | Male | 24 Years in CRE
The negative overreaction to everything office.
Residential Brokerage | New York | Female | 35 Years in CRE
What has surprised me most about the CRE market in 2024 is the alarming number of unscrupulous brokers who have resorted to devious and outright uncivilized behavior toward their clients and colleagues. It seems that ethics have become a luxury in today's market. The intense competition for the few available deals has turned it into a survival fight, often at the expense of professional integrity.
Brokerage | Washington, D.C. | Female | 36 Years in CRE
That while we are several years out from the horror of the pandemic, things still aren’t great. Office space occupiers are still struggling with what their respective policies are on requirements for being in the office. The impact of interest rates requires us to find new ways to get deals done. And it is reflective of the times that the best amenity during these days of amenity wars is a well-capitalized owner who can transact.
Corporate Real Estate | Houston | Male | 43 Years in CRE
What has surprised me the most is my clients’ increasing appetite for all types of space. The other thing that has surprised me is the number of office buildings facing an uncertain future. Loans are coming due and yet there is no clear path for a change in ownership and control. Most lenders are not prepared to take the buildings back, there is limited capital to fund transaction costs (tenant improvements and commissions), and there are very few buyers and lenders to acquire the buildings and reposition them. They are stuck. The result is a bifurcated office market with misleading vacancy rates. I believe most of the vacant space is in buildings that do not have the ability to transact, and that creates misleading marketwide vacancy rates.
Office | Washington, D.C. | Female | 25 Years in CRE
Despite headlines around overall market vacancy, there’s very healthy demand for well-located, premium spaces, particularly for larger tenants (100K RSF-plus). Occupier activity since the beginning of 2024 has been encouraging, and return-to-office metrics have steadily improved. Occupiers are engaged and continue to invest and upgrade their spaces. The top-down tightening trend is starting to shift leverage on an asset-by-asset basis toward the investor's benefit. Meanwhile, the commodity and more aged inventory set continues to struggle.
Office | Philadelphia | Male | 20 Years in CRE
How firmly new hybrid and workweek patterns have taken root.
Office, Industrial, Land | San Antonio | Male | 44 Years in CRE
Didn’t expect the industrial developers to keep building given demand slowed/stopped last year. Bit surprised that multifamily occupancies and rents have held up despite lots of new supply, but that will keep coming for a while here in San Antonio. Thought we would see more office distress, but so far, little or none in San Antonio.
Retail | Houston | Male
The ongoing shrinkage of availabilities in the market pertaining to quality retail and the amount of planned mixed-use developments that are going toward more suburban markets.
Development, Investment | Washington, D.C. | Female | 15 Years in CRE
I’m surprised that CRE layoffs have not been more widespread given transaction pacing and economic conditions.
Office, Multifamily, Hotel Investment, Development | Denver | Male | 24 Years in CRE
I thought more multifamily investors that bought at the peak, that overlevered and used floating-rate debt, would have capitulated by now.
Life Sciences, Industrial, Multifamily | Boston | Male | 20 Years in CRE
I anticipated a busier first half of the year given the uncertainty surrounding the election in November. A very narrow deal profile is generating buyer interest, and everything else is a real struggle.
Investment | National | Male | 25 Years in CRE
The level of distress for office in primary markets, first-tier cities such as NY, San Francisco, LA and Chicago, are all quite staggering and surprising. There is very little positive news. The headlines of these office markets falling off a cliff in these “go-to” markets has, in turn, tainted all office markets nationally, regardless of the health of the individual local markets. So, I’m further surprised that South Florida has remained so resilient and is in high demand by national and international investors and tenants. It bodes well for the region.
Private Equity Investment | London | Male | 20 Years in CRE
Positive: The resilience of tenant demand in the office market, especially for the B buildings in A locations. Every PERE-like article tells you tenants will choose the A buildings if forced to make a budget-driven choice, which would suggest strong demand for A buildings in B locations. That’s not correct. Tenant demand is stronger (anecdotally for us) in the A locations even if the tenant has to compromise on the building quality/ESG/sustainability.
Negative: The continued lack of core/core-plus capital in the market that really generates most of the market liquidity for stabilised assets.
Office Redevelopment | Dallas, Denver | Male | 31 Years in CRE
The strength of the leasing market for spaces below 5K SF. You are getting pressure from larger companies that are downsizing into this segment and also demand from Covid side hustles that are becoming real businesses and need small spaces. Everyone is talking about a flight to quality, but we are seeing a “flight to value” in this segment. If you are the lowest lease rate in this market, you will fill up quickly.
Multifamily, Industrial, Self-Storage, Manufactured Housing | Dallas | Male | 30 Years in CRE
Very little, other than the headlines, which say things are terrible. But outside of office and some urban environments, that is simply not the case. The higher rates affect everyone, but the amount of distress and challenges are overstated outside of the office sector.
Proptech | Los Angeles | Male | 18 Years in CRE
Many — including our team at times — had predicted a greater recovery by this point. The abundance of wealth and capital on the sidelines has remained disciplined (i.e., not jumping into deals that don’t pencil out) and recovery has taken longer than anticipated. Ultimately, this might be a good thing, as taking our medicine for longer may result in a smoother and more robust recovery long-term.
Affordable Housing | New York | Male | 23 Years in CRE
My biggest surprise in ‘24 was that a housing deal got done in Albany. I had expected it to go for at least another year. Looking to see how the new programs on production and tenant protections actually play out.
Retail | New York City | Male | 17 Years in CRE
I don't know if it surprised me, but it’s pleasant. Subway stations are packed. The Midtown deli, where people are waiting for lunch on a Tuesday, is slammed. At Starbucks, there’s a line around the corner. A lot of that speaks to New York coming back to the way that it always has been traditionally.
Job Recruiting | National | Female | 10 Years in CRE
I thought we would experience a little bit more of a return to normal and that things would be more predictable than they had been the last several years. I'm most surprised that the trends and the patterns and the rhythms of this business that I've been so immersed in for the last 10 years are still so unpredictable and unexplainable. I would have expected things to be a little bit closer to pre-Covid this year, and it's continued to get weirder and weirder.
Retail | Chicago | Female | 26 Years in CRE
The resiliency of the consumer. We are a 75% retail portfolio. Consumers have become more careful but are still spending.
Office | San Francisco | Male | 15 Years in CRE
The exciting thing about the office market is more tenants are in the market; however, they are taking a long time to make decisions about space.
Self-Storage Investor | Albuquerque | Male | 20 Years in CRE
Some community banks have returned to lending on development. It's their time to make money. The deals they are seeing today are fantastic deals. If a deal works at 55% loan-to-cost at 9% interest, it's going to be solid.
Multifamily | Washington, D.C. | Male | 20 Years in CRE
The resiliency of the consumer and American renter. In the face of heavy supply, the rental market has remained strong, in part because jobs have held up and renters are staying longer in the renter pool due to the increased cost of homeownership.
Legal | New York | Male | 30 Years in CRE
I have been surprised most by the relative calm and rationality demonstrated by all CRE players (lenders, borrowers, buyers, sellers) — there seems to be clarity and agreement on the way these players view the market and thus the basis upon which actions and decisions are being made. I believe the next six to 12 months will be an important period for defining the scope and depth of CRE’s recovery and whether the uptick we are seeing in the second quarter of 2024 manifests any long-term strength and recovery in the CRE sector overall.
Multifamily | Brooklyn | Male | 21 Years in CRE
I’m not really surprised by the market today. Since the passing of the 485X and Good Cause, we have seen more activity in the market, but this was expected. We were hoping for a few interest rate cuts to kick-start more transaction volume, but our expectations were that 2024 would be a slow thawing-out year and that 2025 and 2026 could be the start of a new upward cycle.
Office Brokerage | Washington, D.C. | Male | 27 Years in CRE
The D.C. government's building tax assessments do not align with current market conditions, despite a significant decline in property values and sales comparables showing losses exceeding 40%. This discrepancy highlights the need for an adjustment to accurately reflect the true value of properties in the District. Despite these clear trends, the District appears to be overlooking this critical issue amidst a substantial budget deficit. In office leasing, tenants are increasingly concerned about landlords' financial stability as a result of the challenges in the market. With a significant number of landlords facing financial strain, there has been a surge in lenders reclaiming assets.
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