CRE Deal Activity Surges to Close Out 2025 — Even Without the Data Center Boost

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Good morning. CRE transactions finished 2025 on a strong note, with deal volumes rising for the second year in a row. Even without a headline-grabbing data center deal, activity was up across nearly every major property type.

Today’s issue is sponsored by Covercy—upgrade your stack with real-time sync and investor reports you can trust.

🎙️This week on No Cap: From Caesars’ bankruptcy to controlling half the Las Vegas Strip, VICI Properties CEO Edward Pitoniak reveals how experiential real estate quietly outperformed the skeptics.

CRE Trivia 🧠

Which U.S. region ranked as the most competitive rental market in 2025, according to the Rental Competitiveness Index?

(Answer at the bottom of the newsletter)

Market Snapshot

Transaction Volume

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• Prospect faster: DealGround converts your documents and rent rolls into actionable intelligence and generates high-quality leads for you with verified names, emails, phone numbers, and source links – all built for broker-led prospecting. (sponsored)

• Private prevails: REIT IPOs have all but disappeared as commercial real estate firms increasingly favor private capital over navigating the costs, scrutiny, and volatility of public markets. 

• When and how to rebalance your portfolio: Investors should consider evaluating allocations at least once a year. Learn about 5 rebalancing strategies to manage risk and enhance diversification. (sponsored)

• Debt spiral: Jamie Dimon cautions that the U.S.’s surging $38.5T national debt could spark a future financial crisis, reinforcing long-term rate and volatility risks for real asset investors.

• ULA exemption: A proposed 15-year Measure ULA exemption for new commercial projects could improve LA development feasibility by reducing transfer-tax exposure.

• Affordable pipeline: Affordable housing construction remains concentrated in select metros, highlighting where subsidy pipelines may support future multifamily supply.

• Regional shift: Housing strength is shifting toward Midwest and Northeast hubs as Southern and Western metros cool, affecting near-term rent growth assumptions.

• Shrinking payout: Elme Communities sold three assets as part of its liquidation, lowering expected returns and underscoring pricing pressure for office-heavy portfolios.

• Funding freeze: Developers face mounting uncertainty as HUD’s paused shift to temporary housing threatens stability for tens of thousands relying on Continuum of Care grants.

• Detention impact: A planned ICE detention center could double a small Texas town’s population, driving sudden demand for housing, infrastructure, and services.

• Industrial trade: BlackRock and IDI traded an industrial asset for $73M, reflecting continued liquidity and pricing discovery in core logistics facilities.

• Denver sale: A $47M sale of an industrial portfolio north of Denver is signaling sustained investor appetite for secondary-market distribution assets.

• Small bay: Investors are targeting small-bay industrial as AI and e-commerce boost demand from local distributors and service users.

• Store conversions: Amazon is converting some Fresh and Go locations to Whole Foods, reshaping grocery footprints and retail real estate demand.

• Stability ahead: Colliers’ 2026 outlook sees retail stability tied to necessity-based tenants, supporting selective leasing and acquisition strategies.

• Napa reposition: Knighthead is repositioning Napa Valley office and retail assets, reflecting capital rotation into lifestyle-oriented, tourism-driven properties.

• Grocery buy: Carlyle and Pebb acquired a Sprouts-anchored retail center, highlighting continued investor preference for grocery-backed cash flow.

• Office spark: A rebound in venture capital funding is lifting early signals of tech office demand, supporting selective leasing recoveries.

• Sale review: Orion Properties is exploring a sale after resisting private investors, reopening consolidation possibilities among office REITs.

• HQ splash: Speedo is planning a new U.S. headquarters ahead of the 2028 Olympics, adding office demand tied to brand expansion.

• Hotel revival: Ian Schrager is forming a new partnership to revive his hotel brand, reopening development and branding opportunities in lifestyle hospitality.

• Loan refi: Lone Star refinanced a hotel portfolio loan ahead of its 2026 maturity, reducing near-term refinancing risk amid tight credit markets.

A MESSAGE FROM ALTUS GROUP

Q4 2025 valuation trends by market and property type

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• Review how returns are shifting across sectors and markets

• Explore key drivers such as yield and cash flow across property types and geography

• Cover property value variances across the major metropolitan markets

Date: Thursday, February 5 | 1:00 PM ET

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📈 CHART OF THE DAY

CRE Trivia (Answer)🧠

The Northeast — with an RCI score of 80.6, narrowly edging out the Midwest and Florida.

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