Commercial and Multifamily Mortgage Debt Continues Climbing in Q125

Together with

Good morning. Commercial and multifamily mortgage debt hit a new record high in early 2025, continuing its upward trend. Plus, Brookfield’s insurance arm is backing away from private credit.

Today’s issue is sponsored by InvestNext—discover proven strategies to attract, engage, and convert the right investors.

🎙️ This week on No Cap podcast, Crowd Street’s leadership opens up in a rare interview about rebounding from its fraud scandal while doubling down on tech, trust, and a bold expansion into private markets.

Market Snapshot

Steady Climb

TOGETHER WITH INVESTNEXT

Beyond Accreditation: Acquire Investors Who Actually Commit

What separates investors who commit from those who waste your time? 

How do you identify prospects who will invest capital to your specific asset class, deal structure, and investment timeline? 

Our expert panel shares real-world examples of successful investor acquisition strategies that have helped firms scale from 20 to 200+ qualified investors in Connect, Commit, Close: The Modern Investor Acquisition Playbook.

*This is a paid advertisement. Please see the full disclosure at the bottom of the newsletter.

• Watch now: Discover why mobile home parks are emerging as high-return investments, with insights on strategy, market trends, and what actually works. (sponsored)

• Strategic outlook: Hines sees opportunity in a fragmented global market, leaning into living, retail, and office credit as structural shifts redefine real estate investing in 2025.

• Office hopes: Bank CRE loan originations slipped slightly in Q125, with early signs of stabilization in the office sector.

• Equity alternative: REITs have lagged in recent years, but Morningstar sees value as share prices hit historic lows and dividend yields remain attractive.

• Credit caution: Brookfield’s insurance arm is backing away from private credit, citing overcrowding, yield compression, and weaker creditor protections.

• Economic check: RealPage’s early 2025 predictions proved mostly accurate on jobs and wages, but optimism faded as consumer sentiment and delinquencies worsened.

• Pre-leasing pace: Student housing preleasing remains strong, but rent growth has hit a multi-year low amid oversupply and enrollment pressures.

• Aging renters: Rentership among Americans aged 65+ rose by 2.4M over the past decade, making them the fastest-growing renter demographic in the US.

• Seattle spike: Multifamily demand in Seattle surged in Q125 as construction activity dropped sharply, pushing rents, sales, and absorption higher.

• Legislative recap: NY's 2025 legislative session brought a mixed bag for real estate, with some key wins for landlords and owners, and notable setbacks for tenants.

• Boston buildout: Greystar continues its Boston-area expansion with a $113M multifamily buy in Malden.

• Storage slump: Self-storage rates dipped 0.5% in May as demand shifted and development held steady.

• Sector slowdown: Industrial REITs are flat YTD amid policy-driven demand shifts, but analysts expect recovery and rent growth by 2027.

• Fremont find: BKM Capital bought the 165K SF Hannover Industrial Park for $43M, eyeing leasing upside and value-add upgrades.

• Midwest acquisition: Diamond Properties acquired two fully leased industrial assets in Ohio, expanding its logistics-focused portfolio with income-ready properties.

• Recovery play: PGIM Real Estate spent $347M on two industrial and one residential asset, betting on a CRE rebound led by logistics and housing demand.

• Experience upgrade: Bergen Town Center in NJ is unveiling a $50M rebrand with celebrity guests and food events, aiming to boost foot traffic.

• Bozeman boost: A $47M overhaul is transforming Bozeman’s Gallatin Valley Mall into a mixed-use destination with Whole Foods, medical offices, and open-air retail.

• Steady stride: Columbia retail saw slight negative absorption, but low vacancy and steady demand signal ongoing stability.

• Prime pick: Blackstone bought 40% of two Meta-leased Bellevue offices, valued at $545M, reflecting confidence in prime assets.

• AI appetite: AI firms are driving fresh office leasing in tech hubs like San Francisco, creating momentum for REITs.

• Lab expansion: QurAlis doubled its Cambridge HQ to 30K SF, expanding lab and office space to support ALS research.

• Discount deals: Chicago’s office market is showing fresh signs of life as buyers snap up discounted properties, betting on a long-term rebound.

• Special servicing: A $67.5M loan tied to Realty Bancorp’s LA offices, including the Rams HQ, is in special servicing amid income drops and 73% occupancy.

• M&A activity: Hospitality M&A is focusing on smaller, strategic deals amid high costs and growing demand for digital and experiential assets.

A MESSAGE FROM CRE DAILY

Q225 Burns + CRE Daily Fear and Greed Index

The latest Q2 2025 JBREC + CRE Daily Fear and Greed Index is in, offering a fresh look at investor sentiment across commercial real estate.

Access the 29-page survey chartbook for in-depth insights into investor sentiment, capital trends, and challenges—along with a sector-by-sector breakdown featuring exclusive commentary.

*This is a paid advertisement. Please see the full disclosure at the bottom of the newsletter.

📈 CHART OF THE DAY