Upstate NY Leads the Pack for Projected Rent Growth in 2025

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Good morning. As national rent growth loses steam, a new analysis highlights the US metros best positioned for gains in the year ahead. The surprising front-runners? Two Upstate New York cities leading the pack.

Today’s issue is sponsored by WareSpace—the next generation of small-bay industrial.

🎙️ This week on No Cap podcast, Jack and Alex sit down with Tommy Lee, Global Head of Capital Markets at Trammell Crow Company—the largest commercial real estate developer in the US—to break down what it really takes to make a deal pencil in today’s market.

Market Snapshot

Market Leaders

TOGETHER WITH WARESPACE

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

• Resilient returns: CRE remains a smart 2025 play, with long-term fundamentals and tax advantages outweighing short-term market volatility. (sponsored)

• Board shuffle: Cushman & Wakefield chairman Brett White exits as Blackstone’s Steve Plavin steps in during board overhaul.

• Cautious confidence: Avison Young sees steady CRE fundamentals and rising activity ahead, despite cost and policy headwinds.

• Federal fallout: Markets like D.C., Anchorage, and Honolulu face rising real estate risks as federal job cuts loom.

• Rent revolt: Amid record rents and rock-bottom vacancy, NYC mayoral candidate Zohran Mamdani surges with a platform of rent freezes and public housing.

• Debt spiral: CRE lenders are facing a multi-front crisis as rising rates, looming maturities, regulatory risks, and investor flight converge to threaten the sector’s financial stability.

• Exit strategy: Germany’s PBB is offloading its $4.6B U.S. CRE loans, citing political and economic volatility.

• Mamdani moment: A red-hot housing crisis is reshaping New York’s political landscape—with a democratic socialist surging ahead in the mayoral race on a platform of rent freezes and public housing.

• Fee transparency: Operators are using fee clarity and concessions to compete amid fraud, regulation, and softening demand.

• Credit builder: Rent reporting is gaining ground as renters seek credit boosts and agencies like Fannie Mae and Freddie Mac now factor rent history into underwriting.

• Rent strain: A record 22.6M US renters are now cost-burdened, as new supply skews high-end and rising costs outpace federal aid.

• Supply surge: Myrtle Beach multifamily occupancy is expected to bottom out by Q3 as a multi-year construction surge nears its end.

• Senior bet: Tennessee’s TCRS has committed $150M to Welltower’s first senior housing fund, backing a $2B push into assets across the US.

• Power crunch: The GOP’s proposed tax credit cuts for wind and solar threaten to deepen power shortages in key data center markets

• Ohio expansion: Plymouth Industrial REIT acquired a 1.95M SF industrial portfolio across three Ohio cities for $193M.

• Refi boost: Affinius Capital supplied a $33.5M loan to 10 Federal Storage to refinance 13 self-storage properties across five states.

• Austin acquisition: ALTO Real Estate Funds bought a 24-acre site in northeast Austin, with plans to develop two 126K SF industrial buildings.

• Rural rollout: Dollar General is piloting fuel stations at 40 rural stores, signaling a bold shift toward becoming full-service hubs.

• Market merger: C&S Wholesale Grocers will acquire SpartanNash for $1.8B, combining two major food distribution and retail forces into a 200-store, 60-distribution-center network.

• Acquisition complete: RCG Ventures has closed its $1.8B acquisition of a 99-property, 14M SF multitenant retail portfolio from Global Net Lease.

• Cannabis lifeline: Gov. Abbott vetoed a bill banning THC hemp products, preserving Texas’s $8B industry and millions of SF in retail space.

• Occupancy trends: JLL’s 2025 Global Occupancy Planning Benchmark Report reveals top firms are prioritizing portfolio optimization and hybrid governance over cost-cutting.

• Takeover attempt: Kawa Capital has offered $126M to take Orion Properties private, valuing the 8M SF office REIT at a 31.5% premium amid weak earnings.

• Loan default: Unizo Holdings has defaulted on a $211M CMBS loan tied to two NoMa office buildings in DC, pushing the properties into special servicing.

• Tower tourism: The Skydeck observatory at Chicago’s Willis Tower has been appraised at over $420M, generating more than 20% of the tower’s revenue.

• Debt cleared: The Trump Organization has fully repaid the $114M mortgage on 40 Wall Street, wiping out a major liability as the tower becomes debt-free.

• Hotel shelters: NYC extended a $929M contract with the hotel industry to house homeless individuals and asylum seekers in emergency shelters through June 2026.

• Wage revolt: Los Angeles hoteliers are pushing back against a city-mandated $30 minimum wage, warning it could gut profitability, cancel renovations, and undercut tourism.

• Hotel halted: The LA City Council rescinded approval for Relevant Group’s 114-room Hollywood hotel after a court ruled the project may pose environmental risks.

📈 CHART OF THE DAY