It’s feel-good Friday over here as we peruse the latest Deloitte report on CRE.

A whopping 90% of global CRE companies it surveyed said their revenues will rise in 2025 — including 60% that said growth will top 5%. 

That’s a huge turnaround from the last two years, when CRE broadly forecast revenue declines. 

Only 7% said they expect to trim their spending, down from 40% a year ago.

However, there are some things still weighing down the optimism: elevated interest rates, cyber risks, tax policy changes and the cost of capital. The stubbornly high inflation in the U.S. has most market watchers predicting at best one interest rate cut this year, a major dampener on spirits. 

Regardless, the gist of the report is this: It’s time to get dealmaking again. 

“Following several years of muted revenue growth, cutbacks in spending, and weakening fundamentals, there are indications that 2025 could be a year of revival for the global commercial real estate industry,” Deloitte said. “Leaders should consider shifting from recent defensive approaches to more proactive strategies.”

— Catie Dixon, Kayla Carmicheal, Mark F. Bonner and Jay Rickey

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CRE News Quiz

Your dreams have come true! Hallmark is releasing a rom-com movie this month centered around this hot (or not … it depends) CRE topic. What is it?

(Answer at the bottom.)

On Our Radar

• U.S. job growth slowed in January, adding 143,000 jobs. That’s below the expected 169,000. The unemployment rate dipped to 4%. Leading the gains were healthcare (44,000), retail (34,000) and government (32,000). The BLS revised 2024 job growth down by 589,000, reflecting weaker hiring trends. Labor force participation edged up to 62.6%, and broader underemployment held at 7.5%. It will be some months before President Donald Trump’s economic policy shifts are reflected in the workforce data.

• America’s 100 largest office leases grew 8% to an average of 288K SF in 2024. That reverses a multiyear decline, according to CBRE. The tech industry rebounded, securing 29 of the largest leases (up from 11 in 2023), surpassing finance (15) and business services (13), driven in part by AI growth. Lease renewals dominated the figures, with 68 of the top 100 deals opting to stay put, as relocation costs and limited new office supply made moves less attractive. Manhattan led all markets in securing the largest leases.

• As the Super Bowl returns to the Big Easy, the Superdome’s future is in question. The Superdome is hosting its eighth Super Bowl, the most of any venue, but New Orleans has gone 12 years without the big game and faces growing competition from Las Vegas and Nashville. A recent $560M renovation modernized the stadium, but negotiations over a long-term lease for the Saints remain contentious. With Saints owner Gayle Benson planning to sell the team upon her passing, speculation about potential team relocation looms. While the NFL still praises the city’s unique atmosphere, NOLA faces increasing pressure to retain its place in the Super Bowl rotation. 

• What are the best Super Bowl LIX bets, Jay? Philly is the better team, but KC always wins big games — it's what they do. My favorite long shot is Philly scoring more in the first half and the Chiefs winning the game (+650). But I like the Eagles, so I've got player props likely to hit if they win: Dallas Goedert over 50 yards receiving (-110), Jalen Hurts over 27.5 passing attempts (-108), Patrick Mahomes over 5.5 rushing attempts (-128) and Harrison Butker over 1.5 FG attempts (-192). If this is too much football for you, put a few bucks on the coin toss or the color of the Gatorade dump. Purple is the favorite at +250, but I like lime green at +300. 

• Going to NOLA? Email firstdraft@bisnow.com for tips from Mark on how to enjoy his hometown like a local.

This Morning’s News

BROKERAGE — Capital Markets And Engineering Contracts Drive Colliers' Q4 Growth (Bisnow): Colliers’ revenue rose 11% YOY to $4.8B in Q4. Though that beat expectations, its $2.26 earnings per share in Q4 missed analyst targets, and the firm’s stock fell 9% Thursday. Read more here.

OFFICE — Downsizing Hits Lowest Level Since 2019 (Bisnow): In the fourth quarter of 2024, corporate tenants reduced their office spaces by an average of 2.9% during lease renewals, the lowest downsizing rate since the pandemic began. The 12-month rolling average for space reduction also declined to 7.9%, down from 11.7% the previous year. Read more here.

LEGAL — Zips Car Wash Files For Bankruptcy (Bloomberg): The company grew from a single shop in Arkansas to one of the largest closely held car wash operators in the U.S. with around 260 locations. Its expansion was part of a broader private equity-fueled boom in car washes. Read more here.

PEOPLE — Former Freddie Mac CEO Joins D2 Asset Management (Dallas Innovates): D2 said Brickman’s appointment advances its expansion in the residential real estate sector and builds on its $1B launch and partnership with Koch Real Estate Investments. Read more here.

RETAIL — Forever 21 Eyes Another Bankruptcy Filing (Bisnow): Fast-fashion retailer Forever 21 is contemplating a second Chapter 11 bankruptcy filing about five years after its initial restructuring. The company operates over 500 stores. Read more here.

RETAIL — Tempur Sealy Finalizes $5B Mattress Firm Merger (Retail Dive): The company expects to complete a divestiture of 73 Mattress Firm stores in Q2 as well as its Sleep Outfitters subsidiary, which includes another 103 stores. Read more here.

OFFICE — U.S. Leads Europe In Green Office Push (Bloomberg): Energy-use intensity, which measures the amount of energy a building uses per square foot, declined 20.2% in U.S. office buildings over the past five years, exceeding the 18.3% drop in the European Union. Read more here.

FINANCE — Wall Street Braces For Another Carried Interest Battle (NYT): Many were surprised by Trump's call to end the carried interest exemption, which he called tax breaks for "billionaire sports-team owners." Trump isn't the first president to try to kill the so-called loophole, but so far none have succeeded. Read more here.

HOTELS — Miami Beach Cracks Down On New Hotels (Bisnow): According to a new ordinance, a five-sevenths vote of the mayor and City Commission is now required before any new hotel project can move forward. The measure is intended to slow the expansion of new hotels and incentivize residential development. Read more here.

LA FIRES — City Council Advances Protections For Renters (Bisnow): A motion was approved Wednesday that prohibits landlords from evicting tenants who are facing economic difficulty as a result of the LA fires for reasons including not paying rent. Read more here.

IMMIGRATION — Trump Eyes Shipping Container Firm For Housing (Semafor): The container housing firm Willscot is in talks with the administration to provide temporary shelters for migrants. With 100,000 customers, Willscot is among the largest companies working in the modular office sector, providing private companies with office space for renovation or construction work. Read more here.

OFFICE — D.C. Real Estate Anxiously Awaits Impact Of Trump Workforce Shifts (Bisnow): The Trump administration's recent directives to reduce the federal workforce and mandate a return to office are creating uncertainty over whether the net impact will be positive or negative for D.C.'s real estate market. There are over 300,000 federal employees in the region, accounting for 30% of D.C.'s workforce. Read more here.

RETAIL — 121 Net-Leased JCPenney Properties Hit Market (Hilco): Hilco and Newmark are marketing a portfolio of 121 JCPenney-leased sites in 35 states totaling over 16M SF. Read more here.

FINANCE — Should The Government Sell Fannie Mae? (NYT): The Treasury owns equity stakes in Fannie and Freddie that could be worth over $190B, and that money is tempting to politicians. But selling the GSAs could cause the interest rate on the 30-year mortgage to rise, making homeownership more expensive. Read more here.

INDUSTRIAL —  Real Estate Adapts To Shrinking Supply (Commercial Search): More than 1.1B SF in industrial developments delivered in 2022-2023, but supply slowed to 358M SF delivered in 2024. The pipeline continues to shrink with just 236M SF of starts recorded last year. Read more here.

INVESTMENT — Brookfield Backs Forum’s $100M Real Estate Impact Fund (Access News Wire): Forum's REIIF is a $2.4B private REIT that owns and invests in purpose-built student living across Canada. Read more here.

HOUSING — Massachusetts Launches Plan To Build 222,000 Housing Units By 2035 (Bisnow): The plan includes investments from the $5.2B Affordable Homes Act, expected to create or preserve 65,000 units, and the implementation of the MBTA Communities Act, which has already led to over 3,000 proposed units across 166 communities. It also emphasizes exploring nontraditional housing options. Read more here.

REITs — U.S. Equity REITs Trade At 13.8% Discount (S&P Global): Public equity REITs closed last month at a median 13.8% discount to consensus NAV per share estimates. Read more here.

FINANCE — 75F Raises $45M Series B (75F): 75F says it will leverage this funding to make building automation easier and increase energy savings at multisite portfolios including offices, retail, warehouses and manufacturing. The company has over 1,800 installations across nine countries. Read more here.

INDUSTRIAL — Amazon Revamps Warehouse Tech For Faster Deliveries (CoStar): The robot fleet working in Amazon's fulfillment centers could save up to $10B a year if they can fulfill between 30% and 40% of orders. Amazon said it has six new warehouse robot models that can cover nearly every stage of fulfillment. Read more here.

LIFE SCIENCES — Gov. Shapiro Bets $30M On Pennsylvania Life Sciences (Bisnow): Shapiro allocated the money in his proposed budget for the state, hoping to boost Pennsylvania as a life sciences hot spot like the Bay Area and Boston. He said the "huge life sciences void should be filled by us.” Read more here.

LA FIRES — Banks Face Risk On Jumbo Loans After Mansions Burn (Bloomberg): Over 70% of mortgage debt is nonconforming — also known as jumbo loans — in the parts of LA hit by the fires. That’s nearly five times the U.S. average. Read more here.

***

So You’ve Come For An Answer

RTO! 

Against the backdrop of the swell in RTO mandates across the country, Hallmark’s newest romantic comedy is taking note. Return to Office centers on colleagues Ms. Monday and Mr. Tuesday as their full-time return-to-office mandate blossoms into a romance. It premieres on Feb. 15.

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