Hot Not CRE

Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America. It's Friday, January 16th, 2026. We're closing out the week by following the money — where institutional and sophisticated capital is actually flowing.

🔥 What's Hot — Where Capital Is Flowing:

• Industrial & Logistics — Still King — E-commerce tailwinds, reshoring, last-mile demand; cap rates tight at 5-5.5% but investors accept it for stability
• Multifamily Class B — The Consensus Trade — Workforce housing is the institutional target; value-add strategies are back; structural affordability crisis = durable demand
• Data Centers — The AI Gold Rush — AI and cloud computing driving record leasing; supply constrained by power availability; this is the growth play for 2026
• Real Estate Debt Over Equity — Senior loans yielding 8-10% with downside protection; investors favoring income over speculative appreciation; credit is the new equity
• Secondary Markets & Midwest — Capital rotating from coastal gateways; Indianapolis, Columbus, Nashville, Raleigh seeing increased institutional interest

• Office — Still Toxic — Broad office exposure is a no-go; vacancy elevated; only trophy assets in select markets trading
• Sun Belt Class A Multifamily — Austin, Phoenix, Jacksonville, Atlanta are a pass; supply overhang continues; waiting for the washout
• High-Leverage Floating Rate Deals — 2021-2022 vintage debt with rate cap expirations creating distress; smart money positioning as rescue capital, not bag holders

❄️ What's Not — What Smart Money Is Avoiding:📊 Why It Matters:CRE investment expected to increase 16% in 2026, potentially reaching $562 billion — near pre-pandemic levels. But capital is concentrated: industrial, Class B multifamily, data centers, and debt strategies. Asset selection and market selection matter more than ever.💡 Investor Takeaway:Follow the institutions: industrial for stability, Class B multifamily for yield, data centers for growth, debt strategies for income. Avoid office and overleveraged Sun Belt Class A. Secondary markets offer better risk-adjusted returns. Be selective, be patient, prioritize income over appreciation.That wraps up the week! Have a great weekend. Don't forget to Like, Share and Subscribe! Visit hotnotcre.com to learn more and subscribe to our newsletter. See you Monday!

Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America. It's Thursday, January 15th, 2026.🔥 What's Hot — Class B Wins 2026:Class B Workforce Housing Outperforming — Better occupancy, healthier renewals, steady leasing velocity while national vacancy sits at ~8.5%Institutional Capital Flooding In — Affordability crisis is structural; millennials/Gen Z delaying homeownership; workforce housing is the primary institutional targetRent Growth Advantage — Workforce/mid-tier expected to outperform luxury on rent growth; Midwest leading with balanced fundamentalsSupply Constraint Protects Class B — ~450K units delivering in 2026 (down 45% from peak), but new construction only pencils as luxury — protecting existing Class B❄️ What's Not:Class A Luxury Struggling — Four/five-star properties saw -0.4% rent decline in 2025; competing hardest on price/incentives; won't normalize until 2027-2028Sun Belt Class A Headwinds — Austin, Phoenix, Nashville, Miami, Orlando face supply overhangs; conservative assumptions essentialClass C Execution Risk — Attractive cap rates but elevated expenses, insurance up 25-40%, higher bad debt; only for experienced operators📊 Why It Matters:Multifamily is gradually recovering as supply slows, but it's not uniform. Class B benefits from structural demand: affordability challenges, delayed homeownership, deep renter pool. Class A working through oversupply. Class C requires specialized expertise.💡 Investor Takeaway:Buy Class B in supply-constrained secondary markets, especially Midwest. Target value-add with operational upside. Avoid new Class A in oversupplied Sun Belt until concessions clear. Class B is the sleep-at-night trade for 2026.Thanks for tuning in. See you tomorrow! Don't forget to Like, Share and Subscribe!Visit hotnotcre.com to learn more and subscribe to our newsletter.

Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America. It's Wednesday, January 14th, 2026. The 10-year Treasury is holding steady at 4.18%.

🔥 What's Hot:

• Rate Stability — 10-year flat over past 2 weeks; volatility subsiding; underwriting with confidence
• Spreads Compressing — Multifamily at 150-175 bps over Treasuries; Industrial at 125-150 bps; signals investor appetite
• Deal Flow Picking Up — January transactions +25% vs Jan 2025; agency lenders quoting 5.5-5.75%; CMBS spreads tightened 30 bps since November
• Fed Expectations Anchored — 1-2 cuts priced in for back half of 2026; predictability is bullish

• Higher-for-Longer is Real — Don't expect 3% yields; new normal is 4-4.5%
• Floating Rate Borrowers Squeezed — SOFR at 4.3%; rate cap expirations creating distress
• Construction Financing Tight — 7-8% rates, 55-60% LTV max; supply pipeline shrinking

❄️ What's Not:

📊 Why It Matters:The 10-year at 4.18% anchors all CRE pricing. Cap rates have likely found their floor: multifamily 5-5.5%, industrial 5-5.25%, office 7-8%. We're past repricing and into a new equilibrium.

💡 Investor Takeaway:

Lock in fixed-rate debt. Underwrite conservatively at 4-4.5% yields. Focus on organic rent growth, not cap rate compression. The best deals are priced for today's rates.

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Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America. It's Monday, January 12th, 2026.

🔥 What's Hot:

• National Rent Growth Turning Positive — +0.3% MoM in December; 2.1% YoY, strongest since Q2 2024
• Midwest Markets Leading — Indianapolis, Columbus, Kansas City posting 4-5% YoY rent growth
• Occupancy Stabilizing — National occupancy at 94.2%; Class B leading at 95.1%
• Investor Activity Picking Up — Transaction volume +18% QoQ in Q4 2025; PE and family offices targeting Class B

• Sun Belt Concessions Elevated — Austin, Phoenix, Jacksonville still offering 6-8 weeks free
• New Supply Still Delivering — 440K units in 2025; 380K expected in 2026
• Class A Vacancy High — 8.7% nationally vs 5.8% for Class B
• SFR Softening — Rent growth decelerated to 1.2% YoY

❄️ What's Not:

📊 Why It Matters:The multifamily market is inflecting. Midwest and Southeast secondary markets are healthy, while Sun Belt Class A remains challenged. Investors in workforce housing are being rewarded.

💡 Investor Takeaway:

Focus on Class B in supply-constrained markets. Midwest secondary cities offer the best risk-adjusted returns. Avoid Class A in Austin, Phoenix, Atlanta until concessions burn off — likely mid-to-late 2026.

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Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America.It's Friday — what are family offices and high-net-worth investors actually buying right now?

🔥 What's Hot:

• Direct Deals Over Funds — Control, transparency, co-investments and club deals preferred
• Workforce Housing #1 — Class B multifamily; 6-7% cash-on-cash yields with modest leverage
• Industrial Last-Mile — Small bay near population centers; sticky tenants, low capex
• Net Lease with Credit Tenants — Chick-fil-A, Starbucks, medical; 5.5-6% yields for mailbox money
• Opportunistic Office — Contrarians buying trophy at 40-60% discounts to replacement cost

• Blind Pool Funds with High Fees — 2 and 20 structures falling out of favor
• Development Risk — Ground-up largely avoided; stabilized or light value-add preferred
• Commodity Office — Barbell approach: trophy or deep value, nothing in between
• Highly Leveraged Deals — 50-60% LTV max; 75-80% leverage days are over

❄️ What's Not:

Theme for 2026: Selectivity, control, and conservative leverage. Quality assets with durable income streams.

Thanks for tuning in — and thanks for a great week.

See you Monday!

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Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America.Last week we made the case for Class B workforce housing. Today we're going deeper — what about Class C? Hidden value or value trap?

🔥 What's Hot:

• Affordability Crisis Creates Demand — 50% of renters are cost-burdened; Class C is the only option for millions
• Cap Rates Are Attractive — 100-150 bps higher than Class B; 7-8% going-in yields in some markets
• Value-Add Potential — Strategic renovations can reposition to Class B-minus; 20%+ ROI possible
• Less Institutional Competition — Big players avoid Class C; more negotiating leverage for operators

• Operational Intensity Is Real — Higher turnover, maintenance, collections challenges
• Rent Growth Ceiling — Price-sensitive tenants; don't underwrite aggressive growth
• Financing Is Harder — Many lenders won't touch it; often local banks or private capital
• Regulatory & Political Risk — Rent control, tenant protection laws, code enforcement
• Deferred Maintenance Surprises — Decades of deferred capex; due diligence critical

❄️ What's Not:

Takeaway: Class C isn't for everyone. If you're an experienced operator with local expertise, there's value. If you want passive mailbox money, stick to Class B.

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Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America.Today we're talking interest rates — what the 10-year Treasury is doing and what it means for CRE financing as we head deeper into 2026.

🔥 What's Hot:

• Stability Is Here — 10-year peaked at 4.79% (Jan 2025); settling into 4.2-4.5% range through 2026
• Fed Easing Slowly — 2-3 cuts expected in 2025 & 2026; fed funds gliding to 3.0-3.5%
• Spreads Historically Tight — Great for well-capitalized borrowers refinancing stabilized assets
• Underwriting Clarity — Base case: 4.25-4.5%; stress test at 5%

• Sub-3% Yields Gone Forever — Structural deficits & sticky inflation keeping rates elevated
• Higher Financing Costs Permanent — Core: 5.5-6.5%; Value-add: 6.5-8%+ (150-250 bps above pre-pandemic)
• Cap Rates Won't Compress — Flat to higher bias; adjust exit assumptions
• Refi Risk Elevated — 2020-2022 floating-rate debt facing serious pressure

❄️ What's Not:

Bottom line: Rates are stabilizing, but higher-for-longer is here to stay. Underwrite accordingly.

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Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America.Today we're diving into the regional picture for January 2026. The Sunbelt oversupply story has dominated headlines for two years — but is the tide finally turning?

🔥 What's Hot:

• Texas Triangle Showing Signs of Life — DFW leading recovery, Houston stabilizing, San Antonio outperforming
• Florida Coastal Markets Resilient — Miami & Fort Lauderdale defying gravity; international capital + migration
• Nashville Turning the Corner — Absorption surprisingly strong; rent growth expected by mid-2026
• Carolinas Stabilizing — Charlotte & Raleigh working through inventory; Class B outperforming Class A

• Austin Still Struggling — Vacancy above 10%; rent declines 4-6%; recovery not until late 2026
• Phoenix Oversupply Lingers — Heavy concessions; full recovery likely 2027
• Las Vegas Lagging — Overbuilt during pandemic boom; continued softness through 2026
• Atlanta Suburban Glut — Urban core fine, but suburban submarkets drowning in Class A supply

❄️ What's Not:

Takeaway: Texas and Florida are leading the rebound, Nashville is surprising to the upside, but Austin and Phoenix still have work to do.

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Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America.Today we're kicking off the week with the latest on multifamily and residential heading into 2026.

🔥 What's Hot:

• Supply Wave Peaking — 500K-600K units delivered in 2025; starts down 74% from 2021 peak
• 2026 Deliveries Drop 60% — Supply relief is coming fast
• Absorption Strong — Job growth driving demand; buy vs rent premium at 32%
• Rent Growth Positive — 2-3% in 2025; 3%+ projected for 2026
• Midwest & Coastal Outperforming — Columbus led permits (+1,288 YoY); NYC strong
• Investment Volume — $370-380B sales; cap rates stabilizing

• Vacancy Elevated — 4.9-8.2% nationally; peaked 7.2% November
• Sun Belt Oversupply — Austin, Phoenix, Nashville, Charlotte lagging recovery
• Concessions Common — New Class A hardest hit in high-supply markets
• Single-Family Cooling — Price growth just 0.2% quarterly

❄️ What's Not:

Takeaway: The supply wave is cresting, absorption is solid, and 2026 is shaping up to be a tighter market.

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Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America.Today we're wrapping up the week with the big picture: where is institutional capital and smart money investing in 2026?

🔥 What's Hot:

• Private RE Allocations Surging — 82% of wealth managers increasing allocations over next 3 years
• Data Centers #1 — 100% of new construction pre-committed in 9 major markets; AI/ML driving demand
• Industrial & Logistics Strong — E-commerce, onshoring, cold storage; last-mile and big-box favored
• Multifamily Resilient — Sun Belt, workforce housing, BTR where supply gaps are acute
• CRE Debt Opportunity — Loan volume up 90%+ YoY; CMBS up 110%; spreads down 183 bps

• Generalist Strategies Out — Sector specialists (data centers, life sciences, last-mile) preferred
• Commodity Office Passed Over — Only trophy Class A or deep-discount conversion plays
• Class B/C Retail Under-Allocated — Only necessity-anchored, grocery getting capital
• High Leverage Out — Lower LTVs, fixed/hedged debt now standard

❄️ What's Not:

Theme for 2026: Selective, thematic investing around AI, demographics, and housing undersupply.Thanks for tuning in — and thanks for a great week. See you Monday! 
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