Hello Brick Brief readers, 

Happy Monday and welcome back! In recent news, we’re seeing an improved 2026 housing outlook, office market momentum, and life sciences continue to struggle. 

🏡 2026 Housing Outlook
Zillow and Realtor.com expect a gentle housing thaw in 2026 as modest price growth, slightly lower rates and easing payment burdens give buyers more room to act. They project a 4.3% sales lift, a drop in markets with price declines and rent growth near zero as rising incomes and an 8.9% inventory increase improve mobility for buyers and renters.

🏢 Office Market Momentum
NAIOP and Trepp see office demand firming through 2026 as rising absorption and early valuation gains show a market supported by broader leasing activity. They point to Q3 price strength and a projected 50.5M SF of 2026 absorption as signs of improving sentiment alhtough remote work and policy risks still steer the pace of stabilization.

🧪 Life Sciences Headwinds
Life sciences REIT Alexandria (-53% YTD) is planning for a leaner balance sheet after cutting its dividend 45% due to falling occupancy, lab market softness and Q3 write downs weakened its 2025 income outlook. On the other hand, Cushman Wakefield reports that rising vacancies, softer rents and expanding concessions continue to pressure the sector even as R&D investment sales have climbed 63% YoY.

Bond traders are lifting long-term yields even as the Fed cuts – Markets see sticky inflation, heavy Treasury supply and doubts about Fed independence as reasons long rates no longer follow policy (Bloomberg)

Layoff announcements hit 1.17M YTD in Nov. 2025 – Cuts fell 53% MoM to 71K after October’s spike, marking the highest November total since 2022 (CNBC & Reuters)

Jobless claims fell to 191K, a three-year low – Markets read the drop as confirmation that the economy avoided a surge in layoffs despite weak hiring (WSJ)

Activist investor Land & Buildings is pushing for $7.7B REIT First Industrial to sell assets and return capital to close what Jonathan Litt calls a substantial discount to NAV.

🧱 Litt argues First Industrial trades at a higher implied cap rate than peers despite a decade-long transformation that added nearly 40% new developments and sold more than 40% of legacy assets. He says public markets still view the REIT as a lower-quality operator even though its asset base now rivals major logistics landlords.

🧱 First Industrial owns modern bulk distribution centers, light industrial buildings and development land across major regional logistics hubs including Chicago, Dallas–Fort Worth, Southern California, New Jersey–Eastern Pennsylvania, Houston, Phoenix and Atlanta. These are large regional freight facilities rather than last-mile infill, positioned along core national supply chain corridors.

🧱 Land & Buildings estimates roughly 30% upside to NAV because First Industrial trades at an implied cap rate above private-market pricing for comparable industrial portfolios. Litt says the discount persists because investors have not updated their view of the company’s upgraded footprint.

🧱 The activist wants the REIT to pursue asset sales, monetize excess land, return capital to shareholders, improve investor communication and evaluate strategic alternatives if the gap remains. He also says buyers like Prologis and Blackstone would aggressively bid for the modernized portfolio.

🧱 Litt recently made a similar push at Six Flags, where he argued that company’s estimated ~$6B of real estate should be unlocked through an REIT spin-off or sale after weak park performance and a failed Cedar Fair merger pushed its market cap down to roughly $1.6B. Both campaigns reflect his strategy of targeting companies whose land value is materially underappreciated by public markets, although as with Six Flags the path to executing this playbook may face significant obstacles and prove difficult to achieve.

Takeaway: Public markets reward growth, and Litt believes this leaves First Industrial’s high-quality industrial portfolio undervalued in its current share price. He argues the REIT should sell assets and return capital because private buyers would pay a meaningful premium to the public valuation, unlocking shareholder value he says the market is missing.

Debt Markets Are Loosening As Lending Volume Rises 35% YoY – Cap Rates Stabilize And A Pricing Reset Boosts Transaction Activity As Institutions Re-Enter The Market Despite Long-Term Yields Holding Near 4% (CushmanWakefield)

FHFA Director Bill Pulte faces GAO probe – Lawmakers requested an investigation into his mortgage fraud referrals and internal shakeups as scrutiny grows (Bisnow)

Section 8 payment delays create a $700M–$800M landlord shortfall – HUD says the 43-day shutdown disrupted voucher disbursements, leaving hundreds of housing authorities short on December funds (Bisnow) 

Greystar will pay $24M to settle FTC claims over hidden rental fees – Regulators said the firm misled renters with low advertised prices and undisclosed mandatory charges (Bloomberg)

Mayor Wu pushes higher commercial property taxes as falling office and lab values shift Boston’s tax burden onto homeowners – FY 2026 assessments show another 6% commercial decline with downtown vacancy near 27% and biotech investment weakening (Bloomberg)

Zillow and Realtor.com expect 2026 to bring a gentle affordability thaw with slightly higher prices, slightly higher sales and softer rent growth that gives both buyers and renters a little more room to move.

Zillow expects a modest 2026 housing thaw – Home values should rise 1.2% as improving affordability cuts the number of major markets with price declines in half (Zillow)

Zillow projects a slight sales rebound in 2026 – Existing home transactions should climb 4.3% to 4.26M as pent-up demand unlocks and mortgage rates hold above 6% (Zillow)

Realtor.com sees the 2026 market entering a slow recovery – Mortgage rates near 6.3% and modest 2.2% price growth create a steadier but still affordability-strained environment (Realtor.com)

Realtor.com sees affordability improving as incomes outpace inflation – Typical payments fall below 30% of income for the first time since 2022 while inventory rises 8.9% (Realtor.com)

Realtor.com sees renters gaining mobility as supply surges – Softening rents in the South and West and rising vacancies open more options even as permitting slows future construction (Realtor.com)

Zillow sees renters gaining affordability in 2026 – Multifamily rents are forecast to rise just 0.3% as incomes outpace rent growth and lifestyle renting becomes more common (Zillow)

Investor activity stayed muted in Q3 – High prices, elevated rates and rising losses kept investor purchases flat even as market share held at 17% (Redfin)

Starter-home sales climbed 4.9% in October even as inventory hit a 9-year high - Buyers found more options at the low end while prices rose just 2% YoY to a $260K median (Redfin)

Inventory growth is losing steam as demand softens – Total listings rose just 5.1% YoY with new listings barely up and more delistings as high prices and >6% mortgage rates keep buyers cautious (Redfin)

Class A apartments record 1.4% YoY rent growth despite 94.6% occupancy trailing Class B/C – RealPage says elevated supply pulled national rents down 0.7% as Class C fell 3.2% while Class A continued its 55-month rent growth streak (RealPage)

Multifamily demand remains strong – High mortgage costs and limited for-sale inventory push renters toward apartments as supply shrinks and demand runs 30% above the 10-year average (CushmanWakefield)

Rent growth softens for now – Owners prioritize occupancy amid a record supply wave but a rapidly drying pipeline sets up faster rent gains and tighter vacancies through 2027 (CushmanWakefield)

Rent regulation debates accelerate across major metros as delinquencies climb in stabilized buildings – Trepp says regulated properties face rising costs and widening performance gaps while market-rate assets maintain stronger pricing and lower distress (Trepp)

NYC luxury market defies exit fears – Wealthy buyers keep signing $4M+ contracts as domestic high-net-worth demand replaces foreign investors and RTO momentum pulls affluent end-users back into the city (Bisnow)

NYC will add 12,000+ apartments through office conversions – City of Yes reforms and new tax incentives sparked a surge of projects including 3,000 affordable units as developers race to address high office vacancies and tight rental supply (Bloomberg)

NAIOP sees office demand rebound with 19.8M SF Q3 absorption – Analysts project 20.5M SF of Q4 2025 absorption and 50.5M SF in 2026 as leasing broadens across all regions, though remote-work uncertainty and policy risks still threaten momentum (NAIOP)

Office prices lead Q3’s CRE recovery with a 1.97% value-weighted gain – Trepp says the sector delivered the strongest momentum in a stabilizing market as firmer leasing and opportunistic capital lifted valuations while multifamily and lodging remained softer (Trepp)

Industrial demand surged in Q3 2025 – Leasing rebounded as trade-policy delays eased and stronger economic data boosted 2026–2027 demand forecasts by 70 MSF (CushmanWakefield)

E-commerce is reshaping warehouse demand – Online sales gain share as tariffs disrupt trade flows and developers face power, land and labor constraints that tighten future supply (CushmanWakefield)

Kroger pays $350M to unwind robotic warehouses – The grocer is closing three Ocado-powered fulfillment centers and shifting capital to new store builds after automated e-commerce dragged earnings and failed to scale (Bisnow)

Value-driven shoppers lifted Midwest Black Friday traffic – Consumers prioritized final price, longer in-store deal hunting and small convenience indulgences like coffee as tighter budgets reshaped holiday spending (PlacerAI)

Retail CRE loan spreads stay anchored in the upper 160s – Trepp says lenders maintain steady pricing as mixed consumer spending and tariff pressures fail to dent confidence heading into the holiday season (Trepp)

Upscale dining is set to lead holiday traffic again – Premium restaurants show the strongest YoY momentum while breakfast-first, casual dining and eatertainment enter December on uneven footing (PlacerAI)

Salt Lake City, UT’s home-centered consumer base is driving above-average retail momentum – Strong population growth and a deep homeownership culture are lifting traffic to grocery, home goods and improvement chains (PlacerAI)

Indianapolis, IN’s affordability advantage is powering discretionary retail – Low housing costs and solid employment are supporting stronger family-driven traffic to value and community-oriented chains (PlacerAI)

Raleigh, NC’s young, high-earning population is fueling mixed-use gains – Affluent singles and professionals are driving sharp visit increases at premium dining, retail and entertainment developments (PlacerAI)

Morgan Stanley weighs hedging a data center loan book tied to a $27B financing package – The bank is exploring a significant risk transfer (SRT) to offload credit exposure as rising leverage, project costs and AI-bubble fears push lenders to manage portfolio risk (Bisnow)

U.S. hotel RevPAR decreased 0.3% for the two weeks ending 29 November – Hurricane markets dragged down national comps while non-impacted markets saw RevPAR rise 0.9% (STR)

Life sciences REIT Alexandria slashes dividend 45% to $0.72 – The company cut its payout after steep Q3 losses, falling occupancy and lab market softness triggered write-downs and a reset 2025 income outlook (Bisnow)

U.S. life sciences faces rising vacancy and softer rents – A 63% YoY jump in R&D investment sales contrasts with slowing VC and IPO activity as policy uncertainty lifts concessions and pushes development toward build-to-suit (CushmanWakefield)

Clipper Equity secures a $54M acquisition and pre-development loan for 1800 Park Avenue multifamily site in East Harlem, NY – Valley National Bank provided $44M in senior debt and Leumi Partners supplied $10M in mezzanine financing for the 36K SF parcel (CommercialObserver)

KPC Development secures a $195M construction loan for the 300-key Kali Hotel project in Inglewood, CA – Bank of America provided the financing for the 13-story hotel rising at Hollywood Park next to SoFi Stadium (CommercialObserver)

Paramount Group secures a $175M refinance for the 900 Third Avenue office tower in New York, NY – New York Life provided the new debt on the 600K SF property as Paramount advances its take-private process (TheRealDeal)

LaSalle Investment Management secures a $50M refinance for the One Thomas Circle office building in Washington, D.C. – State Farm provided a $40M loan alongside $10M from LaSalle’s debt platform to recapitalize the 230K SF Class A property (CommercialObserver)

Activist investor Land & Buildings targets $7.7B REIT First Industrial’s valuation gap – Jonathan Litt pushes for asset sales and capital returns to close what he calls a substantial NAV discount as the REIT’s upgraded portfolio trades at higher implied cap rates than peers (Bisnow)

Hudson Pacific sells the Element L.A. office campus in Los Angeles, CA for $231M – Riot Games purchased the 284K SF Sawtelle property through a $150M sale and an $81M lease-termination payment (TheRealDeal)

SL Green buys its partner’s stake in 800 Third Avenue in New York, NY in a deal valuing the tower at $190M – Joseph P. Day sold its 39.5% interest as SL Green assumed full ownership and modified the property’s $177M mortgage (TheRealDeal)

Morgan Stanley buys a three-property senior living portfolio in Denver, CO for $305M – Kayne Anderson sold the 463-unit suburban communities as Morgan Stanley expands its national senior housing platform (TheRealDeal)

Greystar and Artemis buy a 220-unit age-restricted apartment complex in Palm Beach Gardens, FL for $69.4M – United Group of Companies and Sina Companies sold the Everleigh community at 3660 RCA Boulevard; the buyers secured $50.1M in PGIM Real Estate debt (TheRealDeal)

Blackstone sells the Shops at Skyview retail complex in Queens, NY for about $425M – TPG and Acadia Realty Trust are buying the 550K SF Flushing center at 40-24 College Point Boulevard as Blackstone hits its target price after months of marketing (TheRealDeal)

Ortsac buys the 206-unit Ventura Pointe apartments in Pembroke Pines, FL for $52.5M – Lloyd Jones sold the 2018-built complex at 7850 Pasadena Boulevard; Ortsac assumed and refinanced the existing MetLife loan into a $45M Fannie Mae package (TheRealDeal)

San Jose State University buys the Spartan Village on The Paseo student housing tower in San Jose, CA for $165M – Throckmorton Partners sold the 13-story converted hotel; SJSU completed the purchase using state housing grant funding (TheRealDeal)

Sculptor Capital raises $4.6B for its newest distressed property fund – Surging institutional demand is fueling larger pools of capital for debt-burdened and value-add CRE as investors position for 2026 dislocation (CoStar)

Chetrit restructures $151.5M CMBS debt on the 65 Broadway office property in New York, NY – The deal extends the loan for three years as Chetrit adds new equity and negotiates terms with special servicer CW Capital (TheRealDeal)