In 2025, U.S. commercial real estate continued its uneven recovery, with momentum improving but outcomes still highly dispersed. Transaction activity strengthened and pricing stabilized, yet liquidity remained constrained and fundraising headwinds persisted, reinforcing a slow-moving reset rather than a full market rebound.
As 2025 ended, real assets now sits near the lowest relative valuation compared to financial assets in almost a century.
Looking ahead to 2026, the macro backdrop appears meaningfully more supportive than at any point since 2022, driven by lower rate volatility, improving debt availability, and limited new supply across most sectors. Still, this remains a “property picker’s” market, where performance will depend less on broad beta exposure and more on asset quality, basis discipline, and durable demand drivers. We expect continued recovery in transaction volume, modest value appreciation, and persistent dispersion across sectors, with refinancing and restructurings remaining a dominant theme as more than $1T of maturities come due and capital flows stay selective.
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