CRE Daily
Posts
CRE Heads Into 2027 With Capital to Spend, But Not Everywhere

CRE Heads Into 2027 With Capital to Spend, But Not Everywhere

Deloitte’s 2027 outlook points to selective investing, portfolio triage, and a bigger role for AI and tax strategy.

Nina Dale
September 28, 2026

In partnership with

Good morning. CRE is heading into 2027 with more capital in motion, but the days of spreading it around freely may be over. Deloitte’s latest outlook shows an industry getting more selective about which assets, markets and technologies deserve investment.

🎙️ This Week on No Cap: DWS's Todd Henderson on why real estate is becoming the AI immunity trade. (Thanks to our sponsor, Warespace)

CRE Trivia 🧠

Which bank installed the world's first cash machine, unveiled at a north London branch in June 1967?

IN PARTNERSHIP WITH AIRGARAGE

Someone you know owns a parking lot that could be doing more.

AirGarage's Referral Program pays $10,000 for an introduction. You make it, we do the rest:

$10,000 flat per closed referral, with no cap on how many you send
We run the whole deal — the pitch, the terms, and the parking operation
No ongoing involvement from you once the handoff is made

Churches, hotels, event venues, retail centers, offices, apartment buildings, downtown garages: most treat parking as overhead to be managed, not revenue to be optimized. Rates haven't moved in years and the empty hours never get sold.

Owners don't see it as an NOI lever because no one's shown them what it's worth. Know one? All we need is an intro.

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

Market Snapshot

S&P 500

GSPC

7,743.41

Pct Chg:
+0.51%

FTSE NAREIT

FNER

802.26

Pct Chg:
-0.22%

10Y Treasury

TNX

5.158%

Pct Chg:
-0.004%

CME Term SOFR

1-Month

3.90%

Pct Chg:
-0.00

*Data as of 09/25/2026 market close.

Capital Discipline

CRE Heads Into 2027 With Capital to Spend, But Not Everywhere

Commercial real estate is heading into 2027 with more capital in motion, but Deloitte says disciplined deployment, not indiscriminate spending, will define the next cycle.

By the numbers: Deloitte surveyed 950 CRE executives, with 51% expecting revenue growth above 5%. Nearly 80% plan to upgrade or reposition assets over the next 12 to 18 months, while more than 90% say tax strategy is—or will become—central to investment decisions.

Capital is moving: Cost and availability of capital and elevated interest rates remain the industry’s biggest concerns. Still, cross-border CRE investment rose 18% year over year in Q1 2026, and nearly 80% expect to increase real-asset investment by early 2028. The U.S. ranked as the top international investment target.

The great portfolio sort: Demand is increasingly concentrating in modern, well-located properties, pushing owners to separate winners from laggards. Logistics and warehousing led respondents’ list of opportunities, followed by digital economy properties, while neighborhood retail climbed sharply and hotels lost ground.

Tax joins the investment committee: More than 60% plan to shift capital toward jurisdictions or assets with stronger tax incentives. Deloitte says bringing tax strategy into deals earlier could help owners capture incentives, improve cost recovery and boost after-tax returns.

AI meets the leadership gap: More than 90% expect to increase data and technology spending, but just 8% say AI solutions are integrated. Meanwhile, 67% rank AI and data fluency among the most important skills for future CRE leaders—a growing priority as 59% of U.S. CRE leaders approach retirement age within the next decade.

➥ THE TAKEAWAY

2027 rewards selectivity: The playbook is increasingly asset-by-asset: invest where demand supports it, exit where the economics don’t work, and bring tax and AI strategy deeper into the decision-making process.

A MESSAGE FROM ARBOR

Discover Arbor’s Data-Driven CRE Insights

Single-Family Rental Investment Trends Report Q3 2026, the latest installment of Arbor Realty Trust’s industry-leading research series, documents SFR’s continued resiliency amid headwinds.

Even as uncertainty about national housing policy clouded last quarter, rent growth and other operating fundamentals improved as cap rates and debt yields stabilized.

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

✍️ Editor’s Picks

Instant intel: Brokers who answer zoning and feasibility questions on the spot are the ones landowners call back. Prophetic gives brokerages AI-native site intelligence to present with authority and expand into new markets. (sponsored)
Megadeal effect: U.S. CRE sales reached $107B in August, up 127% year over year, but excluding M&A, transaction volume fell 21% as higher rates slowed individual asset deals.
Higher yields: Global sovereign bond yields are settling into a higher range as rising debt issuance, persistent inflation and weaker demand push investors to demand more compensation for long-term debt.
Affordable squeeze: Portland’s apartment oversupply has narrowed the gap between market-rate and subsidized rents, leaving about 2,200 affordable units vacant amid rising operating costs and financial strain.

🏘️ MULTIFAMILY

Student housing: Yardi Matrix reports 93% preleasing for the 2026-27 academic year, while rent growth slowed to 1.1% as new supply and softer enrollment growth tempered pricing momentum.
Rent recovery: U.S. multifamily rent growth accelerated to 2.2% in August, with 74.6% of metros posting monthly gains as recovery broadened beyond the strongest markets.
Concessions squeeze: Miami’s 34,965-unit construction pipeline is intensifying renter competition, keeping rents flat at $2,590 and forcing developers to balance lease-up concessions with renewal retention.
Sales cool: Multifamily sales rose 8% in the first half of 2026, but Q2 momentum faded as higher rates pressured financing, with median prices falling to $185,200 per unit.

🏭 Industrial

AI demand: AI companies leased 4.6M SF across San Francisco and Manhattan in H1 2026, as AI’s share of new leasing reached 31.3% in San Francisco and 8.2% in Manhattan, signaling rapidly expanding office demand.
Cost creep: Industrial construction costs are rising across the Americas, driven by higher material and labor expenses as the development pipeline reaches 389M SF.
Vacancy drops: Phoenix industrial vacancy fell to 8.7% for the fifth straight quarter as leasing outpaced new deliveries, while sales volume rose 8.3% to $877M.

🏬 RETAIL

Starbucks closures: Starbucks will close 250 North American stores as part of its $1B “Back to Starbucks” overhaul, targeting underperforming locations while continuing broader store upgrades.
Retail bet: Rhino Investments Group acquired the 932K SF Randhurst Village in suburban Chicago for $95M, expanding its retail presence and Chicago-area investment portfolio.
Spending squeeze: Consumers are spending more, but 60% cite higher prices, while 72% plan to become more selective and reduce discretionary purchases over the next three months.

🏢 OFFICE

Office distress: Office CMBS delinquency hit a record 13.2% in August, while special servicing reached 15.7% as borrowers increasingly transfer loans before default.
AAA losses: Pimco faces more than $35M in losses after Philadelphia’s Centre Square offices suffered an 85% value decline, highlighting rising risks in single-property CMBS.
Losses mount: Half of Los Angeles office sales closed at a loss over the past year, with 79.2% of buildings above 100K SF selling below prior valuations.

🏨 HOSPITALITY

Pipeline pressure: 143,000 hotel rooms are under construction, with upper-midscale properties accounting for 33.5% of the pipeline, raising potential occupancy pressure as new supply comes online.
Hotel cools: U.S. hotel RevPAR growth slowed to 2% in August from 8.3% in July, largely due to calendar shifts, while 2026 growth remains forecast at 4.4%.

📈 CHART OF THE DAY

Net lease REIT acquisition volume surged roughly 60% year over year in Q2 2026, even as falling acquisition cap rates and rising implied cap rates squeezed investment spreads to just 40 basis points.

CRE Trivia (Answer)🧠

Barclays. Actor Reg Varney made the first withdrawal at the Enfield Town branch on June 27, 1967.

CRE Heads Into 2027 With Capital to Spend, But Not Everywhere

Deloitte’s 2027 outlook points to selective investing, portfolio triage, and a bigger role for AI and tax strategy.

CRE Trivia 🧠