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Commercial real estate deal flow remains muted in late 2025, but the industrial and data center sectors are outperforming. According to Moody’s, these two asset classes are attracting outsized capital allocations as investors respond to resilient demand and long-term structural tailwinds—while most other CRE segments see declining transaction activity.
📊 Quick Dive
U.S. industrial sector deal volume increased 6.8% YoY in Q3 (Moody’s).
Data center transactions rose 18% YoY in Q3, topping $4.2B (JLL).
Overall U.S. CRE deal volume fell 4.1% YoY (Moody’s). Read Full Signal
Global CRE Investment Volumes Firm, with U.S. Lagging Europe and Asia
Global CRE investment volumes stabilized in Q3 2025, with Europe recording a 7% increase and Asia-Pacific up 5.4%, according to JLL. The U.S. saw a 3.6% YoY dip, reflecting cross-border capital caution and weaker office and retail fundamentals. European logistics and multifamily led gains, while APAC’s growth was anchored by the office and industrial sectors. These trends highlight a strategic geographic shift in institutional allocations as global investors respond to regional economic divergences. Read Full Signal
Family Offices and Lender Finance Ramp Up in CRE Debt Markets
Non-bank players are increasing their presence as traditional lenders retrench. Family offices now account for 8.3% of CRE debt originations—a new high for Q4 (Commercial Observer). Lender finance platforms issued $7.6B in new loans, marking a 14% YoY gain, while bank lending volumes dropped 9.2%. This transition signals a growing role for private capital in filling liquidity gaps, but also introduces evolving risk and documentation complexity for sponsors and borrowers. Read Full Signal
Fed Holds Rates; CMBS Spreads Mixed Amid Persistent Macro Uncertainty
The Federal Reserve left its policy rate at 5.50% in November, citing ongoing inflation concerns and a cautious economic outlook (Trepp). CMBS spreads widened by 12 bps on BBB tranches, while AAA tranches remained flat. Swap rates declined 9 bps, reflecting shifting expectations for 2026 rate cuts. Heightened volatility and risk aversion continue to shape pricing and liquidity in CRE capital markets. Read Full Signal
Operators and investors should concentrate on the strongest-performing asset classes—industrial and data centers—where secular demand drivers remain intact. The sustained divergence in deal activity between these segments and the broader market underscores the need for targeted capital allocation and disciplined underwriting. Chasing yield in underperforming sectors or geographies adds significant risk in today’s environment. For lenders and sponsors, the rise of family office and lender finance capital broadens funding options but necessitates deeper diligence on deal structures and covenants. Traditional banks’ continued pullback means sponsors must be nimble in sourcing capital and proactive in managing refinancing timelines and risk exposures.
Track U.S. CPI and PPI data for Fed policy direction signals.
Monitor Q4 deal volume in industrial, data center, and European logistics.
Watch for further expansion of non-bank CRE lending.
CMBS and private credit spread movements will be key indicators of market risk appetite.
Global monetary policy commentary (Fed, ECB) may prompt further capital reallocation.
