Wall Street Bets on Industrial’s Next Phase as Billions Pour In

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Good morning. Two of the biggest names on Wall Street are expanding their warehouse bets — one through debt markets, the other through fresh equity.

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CRE Trivia 🧠

Which restaurant brand reportedly holds over $42 billion in land worldwide?

(Answer at the bottom of the newsletter)

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• Why now? A growing wave of multifamily investors is redirecting capital into manufactured housing. Learn what’s driving the shift. (sponsored)

• Housing pullback: New-home construction slowed at year-end as builders pulled back on starts amid elevated rates and softer demand. 

• Borrowing pressure: Fed minutes show policymakers in no rush to cut rates, reinforcing a higher-for-longer stance that could keep borrowing costs elevated across CRE. 

• Space servers: Elon Musk’s AI ambitions are pushing data center development toward new frontiers—including space-based infrastructure—to meet surging computing demand. 

• Limit increase: The SEC approved raising FINRA’s broker-dealer gift limit from $100 to $300, the first increase since 1992. 

• Human advantage: JLL’s CEO downplayed fears that AI will replace dealmakers, touting disciplined execution and stock buybacks as signs of confidence in brokerage fundamentals.

• Rent stress: Even as rent growth cools, the share of cost-burdened renters continues to climb, underscoring persistent affordability pressures nationwide. 

• Drop in starts: Multifamily construction starts declined sharply to close 2025, suggesting supply relief could emerge in late 2026 and beyond. 

• Policy reset: D.C. lawmakers are weighing changes to the city’s primary affordable housing funding tool, potentially reshaping local development pipelines. 

• REIT review: Centerspace posted 3.5% NOI growth in 2025 but said it’s too early to tell if its strategic review will alter its 2026 plans.

• Balanced outlook: Self-storage fundamentals remain steady, with moderating rent growth and selective development shaping a more balanced national outlook.

• Hub stability: The Inland Empire’s industrial market shows signs of normalization, though it remains one of the nation’s most resilient logistics hubs. 

• Groundbreaking: Ahold Delhaize USA broke ground on an $860M distribution center, reinforcing grocers’ long-term investment in supply chain modernization. 

• Plant shutdown: Smithfield Foods plans to close a major South Dakota facility, reflecting ongoing shifts in packaged meat operations and labor economics.

• Alpha influence: Retail landlords are recalibrating for Generation Alpha, whose digital-first habits are already influencing store design and tenant strategy.

• Expanding footprint: IKEA is adding four more U.S. locations in 2026, accelerating its omnichannel expansion and smaller-format growth strategy. 

• Theater transformed: CityPickle signed a 10-year lease for 37K SF at Times Square’s Paramount Building, converting the former theater into Manhattan’s largest pickleball club. 

• Foreclosure watch: The owner of a suburban Atlanta mall is considering foreclosure, highlighting continued financial strain on legacy retail centers.

• AI anxiety: Wall Street is growing more skeptical of an office recovery, citing painful concessions and uncertainty amplified by AI disruption. 

• Targeted build: Four West Developers unveiled plans for an $85M office project, betting on targeted new construction despite sector headwinds. 

• Broadcast bust: FanDuel Sports Network’s parent is closing two Atlanta offices and cutting 74 jobs after losing MLB rights. 

• Prime demand: SL Green secured 110K SF in new leases at 1185 Avenue of the Americas, offering a bright spot for prime Manhattan office.

• Experience focus: Accor is expanding its luxury lifestyle platform by emphasizing unique, experience-driven properties to differentiate in a competitive hotel market. 

• Board tensions: Pebblebrook Hotel Trust faces renewed calls to sell amid activist investor Palogic's push for strategic alternatives. 

• Mission reuse: A Charlotte extended-stay hotel was sold for conversion into veteran housing, reflecting creative repositioning in the lodging sector.

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📈 CHART OF THE DAY

CRE Trivia (Answer)🧠

McDonald’s, which generates about 36% of its revenue from property rather than food sales.

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