Hello Brick Brief readers, 

Thank you for your continued support! Today we’re seeing the housing market cool further, office prices edge higher as hybrid work settles in, and CRE fundraising gain momentum.

🏡 Housing Cools Further

FHFA data now confirms the cooling we flagged weeks ago after Parcl Labs’ real-time index recorded a 0.4% YoY drop in August. Oversupply in the Sun Belt is forcing cuts and swelling rental supply as accidental landlords step in, pushing rents lower.

🏢 Offices Struggle for Balance
CBD offices gained momentum over suburban assets, lifting values 1.9% over the past three months. Yet national prices remain more than 20% below 2022 peaks as hybrid work sets the new norm, keeping vacancy near 19% and limiting a full recovery.

💰 Capital Raising Accelerates
Private CRE funds pulled in $85B through August, putting 2025 on pace for $129B and topping pre-pandemic levels. Brookfield and Carlyle led the push, while REIT debt issuance and loan originations surged on demand for multifamily, industrial, and data centers.

30Y Mortgage: 6.37% (-1 bps) 

10Y Treasury Yield: 4.15% 

WSJ Prime Rate: 7.50%

FTSE NAREIT Index: 776.89 (+0.37%) 

30-day SOFR Average: 4.31%

Softening jobs and confidence increase pressure for Fed cuts, but officials stress a gradual path given inflation and tariff uncertainty.

US job openings edge up to 7.23M in August – Hiring drops and quits rate falls, signaling labor market stagnation as Fed weighs more cuts (Reuters)

US consumer confidence drops 3.6 points to 94.2 in September – Decline driven by weaker job availability, now at a multi-year low (Reuters)

Fed’s Goolsbee warns tariffs revive business uncertainty – Chicago Fed chief says firms are pausing decisions as inflation stays above 2% (Bloomberg)

Dallas Fed’s Logan urges caution on further cuts – Says persistent inflation and resilient demand leave little room for easing (Bloomberg)

Boston Fed’s Collins warns against aggressive cuts – Says inflation risks require gradual easing despite softer labor market (Reuters)

US heads for shutdown today– Democrats block GOP stopgap bill as health-care clash threatens services and furloughs 750K workers (Bloomberg)

HUD draft rules could cut housing aid for 4M people – Proposed changes add work mandates, 2-year limits, and citizenship requirements for federal assistance (Bisnow)

FHFA House Price Index slips 0.1% MoM in July – National prices still up 2.3% YoY with gains led by the Middle Atlantic (+5.1%) (FHFA)

Starter-home sales rise 3.8% YoY in August – Entry-level homes hit record $260K as affordability keeps demand stronger than mid- and high-price tiers (Redfin)

Case-Shiller Index up 1.7% YoY in July – Price growth slows below inflation, with Midwest and Northeast gains offsetting Sun Belt declines (Realtor.com)

“Accidental landlords” add rental supply in Sun Belt – 2.3% of homes shifted to rentals this summer, topping 5% in Dallas, Tampa, Orlando and Jacksonville, pressuring Invitation Homes and AMH (TheRealDeal)

Insight: FHFA data now confirms the cooling we flagged a few weeks ago after Parcl Labs’ real-time index showed a 0.4% YoY drop in August. Oversupply in the Sun Belt is forcing cuts, swelling the supply of houses for rent as would-be sellers turn into “accidental landlords,” and pushing rents lower.

FTC sues to block Zillow-Redfin rental deal – Agency says $100M partnership cuts competition and risks higher costs for property managers (Bloomberg)

Office prices inch up 1.9% in 3 months – CBD assets post stronger gains than suburban offices, though national values remain 21% below 2022 peaks and trail industrial (+5%) and retail (+5.3%) growth (TheRealDeal)

AI fuels NYC & SF office rebound – Tech hiring pushed New York office demand up 33% YoY and San Francisco up 107%, with tech now driving 18% and 59% of leasing in each market, far above national levels (GlobeSt)

Office utilization stuck below pre-COVID – Hybrid work keeps occupancy weak as national vacancy holds at 18.7% with Seattle rising to 27.2% and office sales averaging $190 psf, far below 2019 levels (GlobeSt)

Insight: Central business district offices gained more momentum than suburban assets, driving a modest uptick in values over the past three months. Yet national prices remain over 20% below 2022 peaks as hybrid work sets the new norm and curbs a full rebound.

NYC office-to-residential conversions more than tripled since 2023 – Volume hit 4.1 msf YTD 2025 as policy shifts and falling office values fuel momentum (CushmanWakefield)

WFH offices give way to hobby rooms – Homeowners repurpose spaces into wine cellars, gyms and teen hangouts amid return-to-office mandates (Bloomberg)

ADP signs 78K-SF office lease at 703 Waterford Way in Miami, FL – HR software firm will relocate in 2027 under a 10-year deal at Nuveen and Allianz’s Waterford Business District, (CommercialObserver)

Self-storage demand surges in U.S. multifamily hubs – Sector has added 547M SF in the past decade to reach 2B SF nationwide, with growth concentrated in Sun Belt metros like Houston, Dallas, Austin and San Antonio where smaller apartments and higher rentership drive demand (TheRealDeal)

Sephora CEO dismisses retail-doom talk – Beauty giant invests in U.S. brick-and-mortar, using 3,400 stores as both shopping destinations and distribution hubs (Bisnow)

Gap Inc. expands into beauty and accessories – Old Navy launches handbags and both brands add beauty lines to capture value-focused shoppers (Placer.ai)

Insight: Value continues to outperform as more consumers trade down, and Gap is expanding into beauty and accessories to capture that shift.

CoreWeave inks $14B deal to supply Meta with AI computing power – Nvidia-backed neocloud diversifies beyond Microsoft as hyperscaler demand accelerates (Bloomberg)

Insight: Just like OpenAI and Google, Meta struck a $14B deal with CoreWeave to lock in GPU-rich capacity it can access right away. All three aim to bypass slow construction cycles of new data centers and guarantee the compute needed to scale their AI models and cloud platforms.

Data center power developer Fermi raises $682.5M IPO – Texas-based REIT targets 11 GW capacity by 2038 (Bloomberg)

Private clubs expand in midsize cities – Developers target growing affluence in Lexington, KY and Savannah, GA (WSJ)

CMBS issuance rebounds 150% in 2024 to $115B despite $69B in distressed loans – Sponsors like Tishman Speyer tapped the market for multi-billion refinancings as CMBS regained momentum (CommercialObserver) 

Blackstone nears $465M refinancing for five-property multifamily portfolio across MA, GA and FL – Financing package includes a $435M CMBS loan and $30M mezzanine debt originated by Morgan Stanley and Natixis, with KeyBank as special servicer (Bisnow)

Buie Stoddard Group lands $54M refinancing for five retail centers in Orange County and San Diego, CA – Financing from Refinance Group of America and River City Bank covers centers including Laguna Niguel Town Center and Commons at Aliso Viejo (CommercialObserver)

Aware Super buys 49% stake in $1.3B US warehouse portfolio – Goodman venture includes three Los Angeles industrial properties leased to Amazon (Bloomberg)

Ikea acquires Nike’s 61K-SF flagship at 529 Broadway in New York, NY for $213M – Jeff Sutton’s Wharton Properties, A&H Acquisitions, Aurora Capital and Thor Equities sold the SoHo property, which Nike has occupied since 2016 at rents starting near $1,600 PSF (CommercialObserver)

JDL and Kayne Anderson acquire 31-acre portion of former Lincoln Yards site in Chicago, IL for $84M – Bank OZK sold the land at a loss after Sterling Bay and Lone Star defaulted on $126M debt (TheRealDeal)

Toba Capital acquires 9-acre site in El Segundo, CA for $54M – Billionaire Vinny Smith’s firm bought part of the former Raytheon campus from Continental Corporation to build a surf park (TheRealDeal)

CC Homes acquires 152-acre site in Davie, FL for $50M – Jackie Soffer’s Turnberry sold the land entitled for 151 single-family homes, where construction and sales are set to begin this year with base prices from $1.6M (TheRealDeal)

Durst Organization in contract to sell 532K-SF office at 205 East 42nd St. in New York, NY for $165M – 601W Companies is buying the Midtown East property, developed in 1927 and renovated for $15M in 2013, with tenants including CUNY and United Way (TheRealDeal)

Tishman Speyer and GIC list CitySpire offices in New York, NY for $150M – The partners are marketing the 380K-SF Plaza District condo at 150 W 56th St. after a $22M renovation, with Newmark overseeing the sale (TheRealDeal)

Vanbarton acquires 400K-SF office at 6 East 43rd St. in New York, NY for $135M – Brookfield provided a $300M loan to fund the purchase from the Milstein family and support Vanbarton’s conversion into 441 rental units, including 111 affordable apartments (TheRealDeal)

CRE capital raising set to top pre-pandemic – Loan originations jumped 30% YoY in H1’25 while private funds near $129B and REIT debt issuance hits $48B, signaling renewed confidence in multifamily, industrial and data centers (GlobeSt)

Queensgate Investments defaults on $71M loan tied to Freehand Los Angeles hotel in Los Angeles, CA – Generator Hostels missed payments to lender Trimont, putting the 226-key property at risk of foreclosure (TheRealDeal)

Flood insurer Neptune raises $368M IPO – Florida-based firm uses AI-driven underwriting agent Triton to process millions of quotes (Bloomberg)