Hello Brick Brief readers, 

Thank you for your continued support! Today we’re seeing power continue to shift toward homebuyers and renters, a new breakthrough from Google DeepMind that accelerates virtual drug discovery and threatens wet-lab demand, and renewed optimism in the industrial sector.

🏡 Power Shifts Toward Buyers and Renters
Housing leverage is tilting back to consumers as more listings and longer selling times ease years of tightness. Homes are selling below asking for the first time since 2019, and landlords are offering record concessions to fill units in a cooling rental market.

🔬 AI Threatens the Future of Wet Labs
Google DeepMind and Yale’s new model can identify and validate cancer therapies entirely through simulation, cutting research time and cost. The shift toward virtual discovery reduces the need for physical lab space and deepens the strain on life science offices already facing high vacancy.

🏭 Industrial Optimism Builds as Uncertainty Eases
Lower rates and clearer policy signals are reducing business uncertainty, prompting more tenants to sign leases and investors to return to the market. Rising transaction volume and stronger leasing pipelines suggest confidence is rebuilding ahead of what could be a steadier 2026 for industrial assets.

30Y Mortgage: 6.22% (-1 bps) 

10Y Treasury Yield: 4.98% (-3 bps) 

WSJ Prime Rate: 7.25%

FTSE NAREIT Index: 784.07 (+0.92%) 

30-day SOFR Average: 4.18%

JPMorgan warns First Brands fallout is raising bank funding costs – Credit fears tied to the First Brands and Tricolor bankruptcies highlight hidden bank exposure, pushing investors to demand higher returns (FT)

Supreme Court denies review in REX v. Zillow – The decision upholds prior rulings clearing Zillow and NAR of antitrust violations tied to MLS segregation rules, concluding the four-year legal battle (RISMedia)

Homebuyers score biggest autumn discounts since 2019 -- September homes sold for 1.4% below final list price and spent 50 days on market as pending sales slipped and active listings rose 8% YoY, boosting buyer leverage (Redfin)

Lower mortgage rates extend housing momentum into fall – Buyers and sellers stayed active in September as listings rose 3% YoY and inventory climbed 14%, doubling the number of buyer’s markets from six to 15 nationwide (Zillow)

Rental concessions hit record high – Zillow reports 37.3% of listings offered incentives in September as landlords compete amid slowing rent growth and record new supply (GlobeSt)

Down payments remain elevated but stable in Q3 2025 – The median buyer put down $30,400, equal to 14.4% of the purchase price, as affordability challenges persist and higher-income buyers dominate the market (Realtor.com)

Average existing U.S. mortgage hits 4.3% – HousingWire says fewer owners are locked into cheap loans, setting up more home sales and turnover in 2026 (HousingWire)

Yardi projects multifamily normalization by 2027 – Rent growth is expected to slow to 2% as annual completions stabilize near 400K units and occupancy levels steady in the mid-90% range (GlobeSt)

Build-to-rent multifamily construction pipeline slows nationwide – About 63.8K units are under construction as of September, down 0.7% since June, with activity strongest in the South and weakest in the West (RealPage)

Plaza College renews and expands to 80K SF at Forest Hills Tower in Queens, NY – The for-profit college signed a long-term lease with owner Muss Development, bringing the 375K-SF building to 99% occupancy (CommercialObserver).

Quality Services for the Autism Community leases 42K SF at 222-25 Jamaica Avenue in Queens, NY – The nonprofit signed a 15-year deal with owner Lakhi Singh Zoria for a new Jamaica center (CommercialObserver)

Industrial cap rates edge lower as Fed eases – Cushman & Wakefield reports average cap rates fell roughly 12 bps across asset classes amid rate cuts and renewed buyer activity (CushmanWakefield)

Rent growth slows but demand holds firm – National industrial rents rose 1.7% YoY in Q3 as absorption reached 45.1M SF and vacancy held at 7.1% with stronger investor optimism for 2026 (CushmanWakefield)

Port of Charleston volumes dip amid trade reset – The port handled 212K TEUs in September, down slightly YoY, as inland rail and vehicle shipments hit records (FreightWaves)

Chipotle visits rise 0.5% YoY in Q3 – Expansion through new locations and drive-thru “Chipotlanes” helped offset softer same-store traffic (Placer.ai)

McDonald’s visits fall 3.5% YoY in Q3 – Inflation, weaker promotions, and GLP-1 drug use weighed on spending among lower-income diners (Placer.ai)

Taiwanese restaurant chain Din Tai Fung expands East – its 16 U.S. locations average $27M in annual sales as it shifts from suburban malls to downtown neighborhoods (WSJ)

Goldman Sachs expands AI infrastructure financing – Its new global team will focus on lending and syndicating debt for data centers and other AI-related projects to capture a larger share of the financing boom (WSJ)

Insight: Just last week, CEO David Solomon warned that the AI infrastructure boom could mirror the dot-com bubble, where ‘some ventures thrive while others falter.’ Even with that caution, this expansion shows that Goldman sees the data-center lending market as too profitable to ignore, given record demand, the ongoing $400B buildout, and ~1% data center vacancy rates.

Hotel analysts expect muted Q3 earnings outlook – Investors anticipate cautious guidance as REITs face margin pressures and activist investor pressure to unlock undervalued portfolios (CoStar)

Google DeepMind and Yale’s AI model identifies and validates new cancer therapy pathway – The 27B-parameter Cell2Sentence-Scale model revealed a potential treatment using silmitasertib and low-dose interferon (GoogleBlog)

Insight: Google DeepMind and Yale’s new model marks a major leap in in silico drug discovery, as frontier AI models can not only predict but also validate new treatment pathways without physical testing. This accelerates early-stage research cycles and reduces reliance on costly wet-lab experimentation. As I have previous discussed, with life science offices already facing high vacancy from pandemic-era overbuilding, this shift toward virtual discovery could further weaken long-term lab demand.

Merck begins construction on $3B, 400K-SF manufacturing facility in Elkton, VA – The project will create 500 permanent jobs and expand Merck’s existing campus as part of its $70B U.S. growth initiative (CommercialObserver)

CIP Real Estate and Almanac Realty Investors secure $820M refinancing for 42-property industrial portfolio – The 6.1M-SF shallow bay portfolio spans six major markets including Atlanta, Dallas-Fort Worth, Charlotte, Tampa, and California’s East Bay and Inland Empire (ConnectCRE)

Vanbarton Group secures $280M refinancing for 980 Sixth Avenue in New York, NY – Invesco provided the five-year loan for the 455-unit tower after Vanbarton converted former WeWork offices into 77 apartments (TheRealDeal)

McHugh Enterprises and First Investors secure $92M refinancing for Hiltons at McCormick Place in Chicago, IL – Access Point Financial provided the floating-rate loan for the 466-key tri-branded hotel connected to the convention center (CommercialObserver)

Federal Realty Investment Trust secures $73.25M refinancing for Chandler Shopping Center Portfolio in Chandler, AZ – The five-year loan covers the 616K-SF retail portfolio comprising Chandler Festival and Chandler Gateway (ConnectCRE)

Related Companies and partners near $1.1B CMBS refinancing for Deutsche Bank Center in New York, NY – Loan from Wells Fargo and German American Capital Corp. refinances debt on the 1.1M-SF office tower at 60 Columbus Circle, which is fully leased to Deutsche Bank (TheRealDeal)

Activist investor Starboard Value takes 5% stake in $8B construction firm Fluor – Plans to push the engineering company to explore options for its NuScale stake, a developer of small modular nuclear reactors, to boost shareholder value (WSJ)

DLC and DRA Advisors acquire 10 West Coast retail centers for $625M – Merlone Geier Partners sold the grocery-anchored portfolio across California and Washington; Truist Bank and Capital One providing $430M in acquisition financing (CommercialObserver)

Institutional real estate targets fall for first time in 13 years – Hodes Weill and Cornell University report shows 2025 allocations dropped 10 bps on average, marking the first decline since the survey began (PERE)

Loan losses revive U.S. bank M&A talks – Credit worries from auto bankruptcies and bad loans weigh on regional lenders like Zions and Western Alliance, fueling speculation of accelerated consolidation (Reuters)

Clarion Partners and Alchemy Properties default on $57M loan tied to 209-211 East 43rd Street in New York, NY – The partners now face foreclosure on the 24-story, 211K-SF office building near Grand Central (TheRealDeal)