Hello Brick Brief readers, 

Thank you for your support. In recent news, traders scaled back mid-year rate cut expectations after strong jobs data, commercial brokerage stocks fell on AI disintermediation fears, and January office attendance improved but remained uneven across markets.

📉 Labor Data Revisions Shift The Fed Path
The US posted its weakest non-recession hiring year since 2003 after revisions, as 2025 job gains were cut to 181,000 total averaging just 15,000 per month before January’s rebound. January 2026 payrolls, however, jumped 130,000 and unemployment fell to 4.3%; in response, traders scaled back expectations for midyear easing, and 2-year Treasury yields climbed to ~3.5% as the next cut moved toward July.

🤖 AI Fears Hit CRE Intermediaries
Commercial real estate brokerage stocks CBRE, JLL, and Cushman Wakefield plunged 12% to 14% over fears that AI could eventually disintermediate high-fee intermediaries, despite no clear product yet replacing complex dealmaking or advisory work. Investors are questioning whether labor-intensive business models deserve the same valuation multiples as AI tools compress workflows and lower perceived barriers to execution, even if it remains hard to imagine high-stakes transactions without a human intermediary at the highest level.

🏢 Return-To-Office Improves But Stays Uneven
According to Placer.ai, office attendance reached its highest level for any January since COVID, though traffic remains 38.3% below 2019 levels on a per-working-day basis. Return-to-office momentum continued but remained uneven across markets; New York slipped 0.3% YoY, while San Francisco climbed 10.9% YoY and Los Angeles gained 15.6% YoY.

US posts weakest non-recession hiring year since 2003 after revisions – 2025 job gains were cut to 181,000 total, averaging just 15,000 per month before January’s rebound (Bloomberg)

2025 job gains were overstated because the government’s early monthly jobs estimates relied on partial survey data, and later updates using more complete employer tax records showed hiring was weaker than first reported. These revisions, however, naturally raise a question about January 2026 job numbers: can we trust those?

January payrolls jump 130,000 and unemployment falls to 4.3% – Headline strength eases labor market fears, but hiring remains heavily concentrated in healthcare and social services (Reuters)

June Fed rate-cut odds fall below 50% – Traders scaled back expectations for midyear easing after stronger-than-expected labor market data (Bloomberg)

Two-year Treasury yields climb to ~3.5% as traders push Fed’s next rate cut to July from June – Stronger labor data curbed easing bets and pressured short-dated bonds (Bloomberg)

Fed’s Schmid warns more rate cuts could prolong inflation – Kansas City chief says policy should stay somewhat restrictive as growth shows momentum and demand still outpaces supply (Bloomberg)

Fed’s Miran says rate cuts still make sense despite strong January jobs data – He points to supply-side reforms and slowing housing inflation as reasons to keep easing even as June cut odds fall below 50% (Bloomberg)

CBRE and JLL plunge 12% and Cushman drops 14% on AI disruption fears – Investors rotate out of labor-intensive CRE brokerage models, though analysts say the selloff likely overstates near-term risk to complex dealmaking (Bloomberg)

Commercial insurance brokerages, wealth managers, and real estate service firms have all recently sold off on AI fears that automation could eventually disintermediate high-fee intermediaries. Despite no clear product yet replacing complex dealmaking or advisory work, investors are questioning whether labor-intensive business models deserve the same valuation multiples as AI tools begin compressing workflows and lowering perceived barriers to execution.

It’s possible fees may compress as AI-driven efficiencies streamline workflows, but it is hard to imagine complex, high-stakes transactions no longer having a human intermediary at the highest level.

CRE job postings more than doubled in 2025 as dealmaking rebounded – Investment and finance roles surged with transaction volume up 22% to $499B, pointing to selective hiring momentum entering 2026 (Bisnow)

Zillow forecasts January 2026 CPI rent inflation at 2.8% and OER at 3.3% – Shelter measures are expected to keep moderating through 2026 as market rents decelerate and rental supply rises (Zillow)

30-year mortgage rate dips to 5.88%, near 2025 lows, as Zillow forecasts a gradual glide toward 6% by end-2026 – Modest rate relief and slowing home value growth could gradually improve affordability this spring (Zillow)

Homebuyers need $111K income to afford median home, $35K more than renters – Rent-versus-buy gap is smallest in 3 years as mortgage payments fell ~4% YoY while rents rose 2.1% (Redfin)

Northeast homeownership rose 1.97% YoY in Q4 2025, led by improving listings and relatively affordable metros like Hartford – Higher regional incomes and slightly lower mortgage rates pulled more sidelined buyers back into the market (Homes.com)

San Francisco home prices jumped 12.4% YoY to a $1.7M median in January 2026 as inventory fell 27% to 651 listings – Compass says AI-driven demand is colliding with an extremely tight supply of homes for sale (TheRealDeal)

January multifamily rents rose 0.6% YoY to $1,713, as oversupply pressures eased and monthly rents ticked up 0.2% – San Francisco led major markets with 6.3% annual rent growth, while Austin stayed weakest with rents down 4.8% YoY (CoStar)

US office leasing turns positive for first time since 2019 with 12.5M SF of net absorption in 2025 – Vacancy edged down to 14% as premium space demand rebounds and construction remains near record lows (CoStar)

Office attendance hit the busiest January since COVID despite Winter Storm Fern – Per-working-day visits improved even as traffic stayed 38.3% below 2019 levels (Placerai)

Storm-driven metro splits shaped January office trends – Dallas visits fell 6.7% YoY, while Atlanta rose 9.1% and Los Angeles gained 15.6% YoY (Placerai)

Return-to-office momentum continued but remained uneven across markets – New York slipped 0.3% YoY, while San Francisco climbed 10.9% YoY as weather impacts diverged (Placerai)

San Francisco office leasing is projected to climb 15% in 2026 as the market rebound accelerates – VTS forecasts 12.8M SF of demand this year after tenants leased 11.1M SF in 2025, up 59% from the prior year (CommercialObserver)

Law firm Linklaters expands by 48K SF at Vornado’s 1290 Avenue of the Americas in Midtown Manhattan, NY – 10-year lease brings the firm’s total footprint in the tower to over 150K SF with asking rent near $100/SF (CommercialObserver)

Meta to spend $10B+ on 1GW Indiana data center campus – Lebanon project spans 4M SF and could open in 2027–28 as Meta ramps AI capex toward a record $135B this year (Bloomberg)

Private equity flips gas plants for billion-dollar gains as AI power demand surges – ECP turned a $2.3B purchase into a $3.45B sale to Talen; data centers are projected to drive nearly 100GW of added electricity demand by 2030 (Bloomberg)

Solar and battery storage contractor Solv Energy jumps 23% in IPO debut after raising $513M – Firm is riding surging data center power demand as its project backlog reaches $6.7B (Bloomberg)

Anthropic to cover grid upgrade costs for new data centers to protect consumer power bills – AI firm will fund new generation and offset demand-driven price impacts instead of relying on existing capacity (Reuters)

Siemens Energy CEO says data center power boom is real, not a bubble – Reservations are converting into orders as gas turbine and grid demand hits record levels with deliveries stretching toward decade’s end (Bloomberg)

Pennymac to acquire Cenlar for $257.5M, adding $740B in subservicing UPB and 2M loans – Deal pushes Pennymac above $1T in servicing and makes it the No. 2 U.S. mortgage servicer as the industry consolidates (HousingWire)

Town Lane acquires ShopOne and its 27 grocery-anchored shopping centers in first retail push – Former Blackstone executive Tyler Henritze is targeting value-add retail expansion after closing a $1.25B debut fund (Bisnow)

CMBS delinquencies rise to 7.47% in January as office hits 12.34% all-time high – Two massive NYC loans at Worldwide Plaza ($940M) and One New York Plaza ($835M) drove much of the jump, even as most distress reflects maturity defaults rather than collapsing cash flow (CNBC)

Saks Fifth Avenue to close eight stores as Saks Global restructures in bankruptcy – Closures include Bala Plaza outside Philadelphia as the retailer refines its footprint after a $2.7B Neiman Marcus deal (Bisnow)

AI adoption in CRE is shifting from pilots to execution – Firms now need data readiness and institutional trust to scale deployment beyond early-stage experimentation (CommercialObserver)