Hello Brick Brief readers, 

Thank you for your continued support! Today we’re seeing the Fed hold rates after February PPI came in hot, higher-quality industrial assets outperform, mortgage applications fall due to rising rates, and AI driving demand for copper and battery storage.

📉 Inflation Keeps Fed On Hold
February producer inflation rose 0.7% MoM and 3.4% YoY as tariffs and higher oil prices drove input costs higher across sectors. The Fed held rates at its March meeting and is now projecting one cut in 2026; Powell flagged tariffs and energy as key inflation risks and stressed that core inflation must ease before cutting.

🏭 Quality Gap Widens In Industrial
Class A industrial assets continue to outperform with cap rates at 5.28% compared to 7.38% for Class C assets, as investors prioritize high-quality logistics properties in core growth markets. AI-driven automation is accelerating demand for modern distribution centers as newer large-scale facilities with higher power capacity capture stronger leasing, occupancy, and absorption.

Other key news today includes:

Fed holds rates as Powell signals cuts on pause until inflation cools – Officials project one 2026 cut while lifting inflation forecasts on tariffs and higher oil prices (Bloomberg)

US producer inflation rose 0.7% MoM and 3.4% YoY in February as price pressures broadened – Tariffs and surging oil prices drove higher input costs, reinforcing Fed’s higher inflation outlook and delayed rate cuts (Reuters)

Powell flags tariffs and energy as key inflation risks keeping rates on hold – Fed needs core inflation to ease before cutting as oil shock may feed into broader price pressures (Reuters)

CRE capital markets remain resilient despite Iran war shock – Deal activity and credit spreads show limited disruption as liquidity and equity continue to support transactions (CushmanWakefield)

FHFA loosens insurance requirements for condos and rural mortgages – Policy shift expands borrower access by allowing alternative coverage options beyond prior strict mandates (NationalMortgageNews)

Florida updates Live Local Act to unlock affordable housing development – Tax benefits now vest at permitting to improve lender confidence and accelerate construction (Bisnow)

Mortgage applications fell 10.9% WoW for week ending March 13 as 30-year mortgage rates rose to 6.30% – Refinance demand dropped while purchase activity held steady (HousingWire)

Homebuilders and buyers reach tentative balance as affordability improves – Falling construction costs and stable demand support entry-level housing despite prior pricing pressure (Bloomberg)

US home insurance premiums rise 4% to $3,057 in 2026 as climate risks drive costs higher – Prices have climbed 46% since 2021, far outpacing inflation across risk-prone regions (Bloomberg)

Top 20% of earners hold 56.4% of U.S. real estate wealth – High home prices and mortgage rates continue to limit ownership for lower-income households (Redfin)

Homes listed in late May sell for 1.7% more or $6,000 premium – Strong spring demand and competition drive higher sale prices during peak listing window (Zillow)

Compass drops lawsuit against Zillow after platform policy shift – Brokerage ends antitrust fight as Zillow opens listings to pre-market homes and expands seller flexibility (Reuters)

Trophy multifamily outperforms as high-income renters drive demand – Rent and NOI growth is strongest at top-tier assets supported by rising household wealth (CushmanWakefield)

Class A office demand strengthens as lower-quality space struggles – Top-tier assets see improving absorption while Class B and C vacancy continues to rise (CushmanWakefield)

Faraday Future signs 99K SF lease for Fortress Investment Group’s office building at 1990 East Grand Avenue in El Segundo, CA – The move downsizes its headquarters from 146K SF in Gardena (CommercialObserver)

US factory orders rise 0.1% in January as manufacturing activity remains subdued – Tariffs and higher energy costs continue to pressure output despite AI-driven demand in select sectors (Reuters)

Industrial cap rates average 6.23% in Spring 2026 survey – Rates remain stable with investors expecting slight compression later in 2026 as interest rates ease (CushmanWakefield)

Class A industrial cap rates average 5.28% vs 7.38% for Class C assets – Investors continue to prioritize high-quality logistics properties in core growth markets (CushmanWakefield)

113M SF of industrial space absorbed in late 2025 led by large facilities – Demand is driven by tenant consolidation into modern logistics buildings tied to e-commerce and AI (CushmanWakefield)

AI-driven automation accelerates demand for modern distribution centers – Newer large-scale facilities with higher power capacity capture stronger leasing and occupancy (CushmanWakefield)

Dirty soda chain Swig visits rise 137.9% since 2023 as expansion drives traffic growth – Customer base is expanding beyond affluent suburbs into middle- and working-class households (Placerai)

US battery storage capacity reaches ~70 GWh as AI-driven power demand surges – Domestic production continues to ramp as data center growth drives grid expansion (Bloomberg)

Google secures 20-year power deal for Michigan data center as AI demand scales – Company commits to funding new renewable and storage capacity to support ~1GW load (Bloomberg)

Google plans to lock in long-term power for its Michigan data center through a 20-year agreement with DTE Energy that funds new renewable generation and battery storage. The deal includes 1,600 MW of new renewable capacity and 480 MW of battery storage to support up to 1 GW of demand.

Prysmian explores Texas copper mill and US deals to meet data center demand – AI-driven power and grid build-out fuels capacity expansion despite tariff risks (Bloomberg)

Prysmian plans to use domestically sourced copper to produce copper rod at its proposed Texas mill, which will be used in power cables for data centers and grid infrastructure.

TerraPower plans $450M Philadelphia life sciences manufacturing facility – Bill Gates-backed firm selects Bellwether District site to produce cancer treatments with state incentives supporting development (Bisnow)

Micron forecasts continued AI-driven memory growth as capex surges – Spending tops $25B to scale production despite strong revenue outlook and rising chip prices (Bloomberg)

Macy’s signals resilient higher-income consumer despite cautious outlook – Strong near-term sales forecast contrasts with softer full-year guidance on tariffs and geopolitical risks impacting spending (Bloomberg)

Marcus Partners raises $875M fund targeting East Coast multifamily assets – Strategy focuses on Southeast and major East Coast metros including Atlanta (CoStar)

Office Properties Income Trust creditors move to take control in bankruptcy restructuring – Lender group led by Redwood and Helix aims to cut $700M in debt and recapitalize office REIT (Bisnow)

Rising Realty Partners defaults on $200M loan for 733K SF office and data center West7Center in Los Angeles, CA – Loan was originated by Brookfield and backed by property now estimated to be worth ~half of its 2016 purchase price (TheRealDeal)

Proptech VC investment hits $16.7B in 2025 as AI platforms gain share – Investors shift away from SaaS toward AI-native tools driving faster growth and new operating models (Bisnow)