REAL ESTATE NEWS

As 2025 draws to a close, commercial real estate executives are increasingly turning their attention to the outlook for the year ahead. Despite the turbulence that characterized much of 2024 and early 2025, the latest insights from CBRE’s research head, Henry Chin, suggest that double-digit transaction volume growth is no longer an improbability—it is shaping up to be a consensus expectation for 2026.

The market tone has shifted decisively since the first quarter of the year. Where uncertainty surrounding inflation and policy once dominated investor sentiment, current analyses highlight marked gains in capital deployment and sector performance.

Chin credits this shift to fundamentals, explaining that pricing strength in the U.S. is now derived less from cap rate compression and far more from operational improvements such as rising leasing rates and sustained demand across major asset classes. “Going forward, for 2025 we are expecting to see a high double digit around 16-17% transaction volume for '25...and the momentum will continue to moving into 2026. We continue to expect...double digit transaction volume growth...office, retail, multifamily, logistics, data centers, Cap market, all in the recovery phase into '26,” Chin says in a recent podcast, emphasizing cross-sector momentum that is anything but uniform.

This narrative stands in stark contrast to prior cycles when broad asset recovery was often predicated on external macro factors, rather than on sector-specific fundamentals. For investors seeking accurate signals of recovery, sector rotation is critical. Data centers, logistics, and multifamily have emerged as consistent leaders, yet Chin is quick to highlight the resurgence in office and retail—a notable reversal from their previously depressed valuations.

Recent transaction figures show that certain U.S. submarkets, particularly Los Angeles, Chicago, and Boston, have already passed their inflection points. Sophisticated investors are monitoring these shifts, reevaluating market-entry timing and capital allocation based on leading indicators from internal, proprietary deal data and aggregate metrics.

What further sets the current cycle apart is the breadth and depth of capital resilience. The recalibration in pricing across sectors has created entry opportunities that seasoned investors are keen to exploit, especially as the market moves off a relatively low base of comparison from recent years. The comparative value of private real estate against publicly traded REITs underscores this window, with Chin noting that commercial properties remain attractively priced relative to equities.

“I can tell you that the commercial real estate market looks so attractively priced…” that the timing for investment is perfect, he observes.

There is an analytical rigor behind this optimism. Chin and his team use not only publicly available metrics but also proprietary transactional intelligence to forecast sectoral turns. “I look at our capital data for deals that we have in the market. I look at the number of bidders, I look at the number of transactions that have closed, and some of those are leading indicators,” he adds.

Rising bid activity and closed deals are forming a clearer picture for the months ahead. For investors focused on 2026, the message is evident: market fundamentals—not sentiment—are steering the cycle, and the breadth of sector recovery provides a more reliable template than in prior cycles characterized by erratic price swings.

As the year closes and the latest data are processed, executives will be presented with a market that is not just broad-based but demonstrably resilient. The persistent surprise in fundamentals—a recurring theme in Chin’s assessment—suggests that those companies and funds ready to move in early 2026 may find themselves well positioned to capitalize on a vintage entry year, provided they remain agile in sector targeting and driven by data rather than headline narratives.

Source: GlobeSt/ALM