Hello Brick Brief readers, 

Thank you for your continued support! Today we’re seeing CRE liquidity poised to unlock transactions, housing policy focused on expanding supply to improve affordability, and data center risk being pushed onto private capital. 

🏢 CRE liquidity unlocks transactions
CRE markets are entering an early recovery phase as improving liquidity and stabilizing valuations turn sidelined capital into executable transactions. Cushman & Wakefield sees tighter credit spreads, rising originations across banks and private credit, and narrowing bid ask gaps improving price discovery and supporting acquisitions and recapitalizations into 2026.

🏡 Housing affordability shifts to supply driven relief
Federal housing policy is refocusing on supply as Trump tees up aggressive housing reforms for 2026 and Congress advances bipartisan legislation aimed at easing zoning, permitting, and standardized home designs. US housing affordability is expected to improve modestly in 2026 as home prices are forecast to rise just 1.5%, allowing wage growth to narrow the affordability gap.

⚡ Data center risk shifts to private capital

Blue Owl stepped back from contributing equity to Oracle’s ~$10B Michigan data center project after judging the lease terms and financing structure as unattractive relative to other data center deals. That decision sharpens concerns raised by billionaire real estate developer Fernando De Leon about hyperscalers pushing ownership of capital-intensive data center assets and long-dated balance sheet risk onto private capital; if AI infrastructure is truly mission critical, why do the largest and best capitalized tech firms not want to own these assets themselves? 

Finance chiefs expect 4.2% price growth in 2026 as tariffs remain top risk – A Fed survey shows CFO optimism slipping as firms anticipate continued pricing pressure that could keep inflation above target (Reuters)

Fed governor Waller floats up to 100 bps of rate cuts – Christopher Waller said jobs growth is near zero and rates remain above neutral (FT)

White-collar job security weakens amid AI fears and layoffs – Office-heavy sectors like information and finance are shedding jobs as unemployment ticks up to 4.6%, leaving workers increasingly pessimistic (WSJ)

CRE markets are entering an early recovery phase as improving liquidity, stabilizing valuations, tighter credit spreads, and narrowing bid ask gaps are converging to unlock more executable transactions and lift deal activity into 2026

Madison International’s liquidity index rose nearly 80 points since early 2024 to 35.6 in Q3 2025 – The sixth straight quarterly gain marked the highest reading since 2022 as CRE liquidity improves even as conditions remained short of full normalization (ConnectCRE)

CRE valuations are stabilizing as capital reenters the market – Pricing resets and early signs of bottoming are pulling investors back into selective acquisitions and recapitalizations, supporting renewed transaction activity into 2026 (CushmanWakefield)

Debt liquidity is improving financing visibility for CRE – Tight credit spreads and rising originations across banks, insurers, and private credit are restoring confidence in refinancing outcomes and deal feasibility after a prolonged freeze (CushmanWakefield)

Better price discovery is unlocking transaction activity – Narrowing bid-ask spreads are reducing execution risk, encouraging investors to move off the sidelines as the next cycle begins (CushmanWakefield)

HUD shifts housing crisis focus to demand factors – The agency says immigration, declining marriage rates, and subsidies are worsening affordability by driving demand faster than supply (Bisnow) 

Trump tees up aggressive housing reforms for 2026 – He pledged new supply-focused housing changes and lower mortgage rates as elevated prices and 6.22% mortgages continue to freeze market activity (Bloomberg)

Insight: Last week during the Fed’s interest rate press conference, Powell noted that modest rate cuts would do little to improve affordability and argued that the housing market’s core challenge is a long-running supply shortfall compounded by mortgage rate lock-in that continues to suppress mobility and resale inventory. 

House advances bipartisan housing supply bill – Lawmakers moved the Housing for the 21st Century Act toward a full vote, aiming to ease affordability by streamlining zoning, permitting, and standardized home designs to accelerate new construction (Realtor.com)

US housing affordability is expected to improve modestly in 2026 - Home prices are forecast to rise just 1.5%, allowing wage growth to narrow the affordability gap (Bloomberg)

20% of U.S. adults said they planned to buy a home within a year, while only 3% to 5% actually buy in a typical year – Zillow found the median prospective buyer was 39 with $100K-125K household income (Zillow)

Bessent flags GSE IPO path as mortgage-sensitive – Any Fannie Mae and Freddie Mac stock offering would hinge on tight MBS spreads to avoid pushing up mortgage rates as housing affordability remains strained (NationalMortgageNews)

Insight: Fannie Mae and Freddie Mac MBS trade at tight spreads because investors view them as effectively government-backed, allowing the bonds to price close to Treasurys despite being issued by private entities. Any IPO or move toward privatization would need to be structured and communicated in a way that leaves no doubt the government backstop remains intact. Even small uncertainty would widen MBS spreads, push mortgage rates higher, and further strain housing affordability, which as you can see remains a core focus of the current administration.

Low immigration could temper housing demand by 2035 – A Harvard study projects 1.7M fewer new households under a low-immigration scenario, modestly easing demand growth while leaving homeownership rates largely unchanged (HousingWire)

Higher flood insurance premiums push low-income households out of NFIP – FEMA’s Risk Rating 2.0 led up to 13% of homeowners facing the steepest increases to drop coverage, accelerating declines in flood insurance uptake even as climate risk rises (Bloomberg)

Wealthy renters increasingly customize luxury rentals with landlord approval – Owners are allowing tenant-funded upgrades that boost long-term property value at no cost as high-end renters prioritize personalized living and work-from-home layouts (WSJ)

Zurich Alternative Asset Management targets hyperlocal office deals in top urban nodes – The Swiss insurer has spent about $125M buying boutique, well-leased office buildings in Cambridge, Denver’s Cherry Creek, and Chicago’s Fulton Market (CoStar)

Bloomberg renews 496K SF office lease at 120 Park Avenue in New York City, NY – The firm signed an 11-year renewal at Global Holdings’ tower with asking rent at $135 per SF (CommercialObserver)

QSR traffic gains come from experience not discounts - Placer.ai data shows McDonald’s and Burger King saw their biggest visit spikes from nostalgic and gamified LTOs while price-led deals lagged (Placerai)

Oracle racks up $248B in data center lease commitments – The cloud provider’s long-dated leases have surged more than 2,200% since 2023, raising concerns about excess capacity risk if AI-driven demand slows (CoStar)

Blue Owl pulls out of Oracle-linked Michigan data center deal – Oracle shares fell even as Blackstone moved into talks to replace the equity; Bank of America is leading the ~$14B debt financing package for the project (Bloomberg)

Amazon in talks to invest $10B+ in OpenAI – Preliminary discussions could value OpenAI above $500B and include adoption of Amazon’s Trainium chips as hyperscalers push alternatives to Nvidia (Bloomberg)

Google and Facebook plan $1.4B in Texas data center construction in December – The companies are driving over 40% of the state’s $3.4B in 2025 data center construction spend with major projects across DFW, Central Texas, and West Texas (TheRealDeal)

Eric Schmidt-backed Bolt Data & Energy partners with Texas Pacific Land to build data centers – The venture raised $150M from Bolt and $50M from TPL as large landowners and new platforms position to capture surging AI-driven data center demand (Bloomberg)

Billionaire developer Fernando de Leon warns that data center valuations and financing structures look unsound – He cites lack of large exit comps, rapid tech obsolescence risk, and hyperscalers pushing ownership and balance-sheet risk onto private capital despite surging institutional demand (CNBC)

Blue Owl stepped back from contributing equity to Oracle’s Michigan data center project after judging the lease terms and financing structure as unattractive relative to other data center deals. 

A seasoned equity partner walking away raises questions about how durable capital support really is for increasingly large, leveraged data center projects and whether Oracle’s massive off-balance-sheet lease obligations are starting to strain credit confidence (they are). 

Billionaire real estate developer Fernando De Leon’s recently warned that hyperscalers are pushing ownership and balance-sheet risk onto private capital through long-dated leases in a sector with limited exit comps and high risk of technological obsolescence. If AI infrastructure is truly mission-critical, why would the largest and best-capitalized tech firms not want to own these assets themselves? 

Micron shares surged 8% after beating Q1 earnings and revenue expectations, as expanding AI data center capacity drove a sharp increase in demand for high-performance and high-capacity memory and storage.