Key Takeaways
Economy
GDP growth should hold in the 1.5-2% range for 2026 supported by AI investments and steady consumer spending, even as inflation lingers. Job growth will remain soft, but the unemployment rate should stay low enough to allow wages and incomes to continue to rise at a healthy pace. We anticipate the Fed will lower the Fed Funds Rate to around 3% by late 2026, the 10-yr treasury yield will stay roughly where it is, creating a more favorable and stable interest-rate environment for property performance. Read more.
Capital Markets
Capital markets are moving through a resilient recovery. Lower costs of capital and historically tight credit spreads are fueling momentum in CRE debt markets, with commercial mortgage originations by banks, insurance companies, and private credit all increasing at double-digit rates. Valuation resets are pulling investors back in, and early signs of price stabilization are sparking both fundraising and selective capital deployment into the first phase of a new cycle. Read more.
Office
The office sector is showing real signs of momentum. Office attendance is settling in at higher levels, gross leasing is trending higher, Class A net absorption has been positive, sublease inventory is declining, and the office construction pipeline is at its lowest level in a decade. A clear theme is emerging: a strong demand for high-quality space, and not enough of it. That said, the office market will remain trifurcated in 2026, with segments that are performing well, struggling, or somewhere in between. Read more.
Industrial
Industrial demand picked up in late 2025 as trade-policy uncertainty eased, allowing tenants to move forward with delayed decisions. E-commerce continues to drive leasing, boosting forecasts for 2026-2027. With development slowing, vacancy will stabilize next year and begin tightening in 2027. Read more
Multifamily
Multifamily demand is set to be 30% higher than its 10-year average in 2025, supported by high mortgage rates, scarce for-sale inventory, and ongoing affordability pressures that favor renting. Read more.
Retail
Retail fundamentals are holding firm, with strong leasing velocity, rising rents, and scarce new supply keeping quality space at a premium despite ongoing margin pressures for many tenants. Read more.
Alternatives
Demand continues to evolve across sectors. Senior housing, student housing, and built-to-rent are thriving on demographic trends, data centers are expanding into emerging markets, and life sciences are showing signs of steadying as funding rebounds and construction slows going into 2026. Read more.
