Key Insights

The Atlanta Fed’s Bostic anticipates only one rate cut in 2025 due to tariff-induced price pressures, while Chicago Fed’s Goolsbee’s sees rates falling "a fair bit lower" in 12-18 months, creating uncertainty that could keep mortgage rates high and challenge real estate financing. This view complicates borrowing costs for developers and homebuyers, potentially slowing residential and commercial projects as new tariffs, like Trump’s 25% on imported cars, ripple through the economy.

Dollar Tree’s $1B sale of Family Dollar to Brigade and Macellum, along with Sycamore Partners’ recent acquisition of Walgreens Boots Alliance, underscores how retailers are downsizing amid inflation issues and growing competition from e-commerce giants. Opportunistic private equity buyers are acquiring these assets, but their strategies—whether through operational turnarounds, cost-cutting, or add-on acquisitions—leave the future of these retail footprints uncertain, with potential implications for retail real estate

Trump’s newly announced 25% tariff on imported cars, which may spark further retaliation, underscores the uncertainty businesses face in a shifting trade landscape. This was evident last month as companies ramped up stockpiling in anticipation of potential disruptions. In February, durable goods orders rose 0.9%, and the Port of Savannah hit a record 479,850 TEUs as businesses rushed to secure inventory, reflecting a broader effort to prepare for escalating trade tensions.

This Week in Real Estate: Key Events & Data

Quick Markets

30Y Mortgage: 6.80%
10Y Treasury Yield: 4.35% (+3 bps)
FTSE NAREIT Index: 775.73 (+0.59%)
30-day SOFR Average: 4.33%

Market Pulse

Rising trade tensions and inflation concerns are complicating monetary policy, with businesses bracing for higher costs through stockpiling while Fed officials remain divided on the timing and extent of rate cuts, adding uncertainty to economic outlooks

Trump imposes 25% tariffs on imported cars and parts – Policy seeks to boost US manufacturing but risks raising consumer prices, disrupting supply chains, and triggering trade disputes (NYT)

Atlanta Fed’s Bostic expects only one rate cut in 2025 – Slower inflation progress and tariff-driven price hikes push back policy easing (Reuters)

Chicago Fed’s Goolsbee sees rates "a fair bit lower" in 12-18 months – Warns that uncertainty could delay cuts and rising inflation expectations are a ‘major red flag’ (Reuters)

US durable goods orders rose 0.9% in February – Businesses front-loaded purchases ahead of tariffs, boosting capital expenditure despite broader economic uncertainty (Reuters)

Policy & Industry Shifts

Regulatory shifts are reshaping housing dynamics, with the FHFA’s rollback of renter protections potentially tightening access to affordable housing, while NAR’s new listing policy may influence market transparency and seller strategies

FHFA rolls back renter protections and housing policies – Pulte reverses Biden-era tenant rights and credit programs at Fannie Mae and Freddie Mac (GlobeSt)

NAR adds 'delayed marketing exempt listings' – MLSs can now delay public marketing via IDX or syndication, giving sellers more flexibility (NAR)

Residential

Mortgage applications fell 2.0% last week – Purchases rose 1% amid more FHA activity, but refinances dropped 5% as rates held steady near 6.71% (MBA)

Home values and equity dipped but stayed near record highs – Q4 2024 real estate value hit $48.1T (third highest ever), with equity at $34.7T despite a $0.4T quarterly drop (Realtor.com)

Office

Office trends reflect a push for both engagement and efficiency, with companies balancing amenity-rich environments to attract employees while optimizing space through higher desk-sharing ratios and tighter density

Amenities drive engagement — Office design now prioritizes social hubs, cafes, and flexible multipurpose areas to boost employee experience (CBRE)

Desk sharing rises — 62% of companies now target 1.5+ employees per desk, up 93% from 2023 (CBRE)

Tighter density, more efficiency — Average space per employee fell 27% to 205 sq. ft., while space per desk rose slightly (CBRE)

Industrial

Strong industrial demand continues as occupiers prioritize cost-effective acquisitions for stability, while rising port activity driven by Southeast growth and tariff-related stockpiling reinforces supply chain shifts.

Industrial occupier acquisitions rose 32% in 2024 – Sales hit 2,504, with older buildings making up over half of purchases as companies seek cost savings and stability (CBRE)

Port of Savannah sets record February – Moved 479,850 TEUs (+6% YoY), with record rail and truck volumes, driven by Southeast demand and tariff-related frontloading (FreightWaves)

Market Mix

CVS visits rose despite closures – +0.6% YoY overall in Q4 2024, with +2.9% average visits per location, while Walgreens saw a slight decline (Placer.ai)

San Francisco hotel bookings surge 70% from convention events in 2025 – International travel downturn and geopolitical tensions offset positive local tourism recovery (GlobeSt)

Earnings

As inflation persists, higher-income consumers are increasingly seeking value at budget retailers like Dollar Tree, which is planning to raise prices on select items to offset tariff pressures while maintaining its appeal to cost-conscious shoppers

Dollar Tree reported mixed Q4 earnings and plans to raise prices on some products to offset tariffs. The retailer is also seeing stronger demand from value-seeking higher-income customers due to inflation and plans to sell its struggling Family Dollar brand for $1B to private equity investors (CNBC) 

Financings

KS Group secured $300M financing to revive the long-stalled NYC Astoria Cove project – First phase includes four buildings with 736 apartments and 318 parking spaces (TheRealDeal)

Goose Property secured $108.5M financing from Apollo for its Williamsburg NYC multifamily building – Deal follows Lidl's lease for 26.5K square feet at the property (TheRealDeal)

Hanover secured an $87M loan for a 345-unit San Jose, CA apartment project -- Includes 328 market-rate units, 17 affordable units, and ground-floor offices (TheRealDeal)

Barings refinances $70M Northern California industrial property – Tracy 205 Logistics Center attracts financing due to strategic location (CommercialObserver)

M&A

The growing presence of private equity in retail M&A is highlighted by Dollar Tree’s sale of Family Dollar and RCG Ventures’ acquisition of a $1.1B retail portfolio, as retailers continue to downsize in response to rising competition and economic pressures, with private equity firms stepping in to restructure and reposition these assets

CoStar raises Domain bid to $1.8B – A 5.5% increase convinces the Australian property portal to open its books, advancing takeover talks (Bloomberg)

RCG Ventures bought a $1.1B retail portfolio from Global Net Lease – Deal includes 59 properties with equity from Koch, Goldman Sachs, and Ares; 41 more properties to close by June (GlobeSt)

Dollar Tree sells Family Dollar for $1B – After paying $9B for the brand in 2015, Dollar Tree offloads the struggling chain to PE firms Brigade and Macellum Capital following a failed decade-long turnaround (CoStar)

Starwood buys 38 warehouses from Goldman Sachs and Dalfen for $685M – Portfolio spans major metros like Dallas and Atlanta, with tenants including Amazon and Kroger (Bloomberg)

Prologis buys $77M industrial site in Northern Virginia – Fully leased warehouse adds to REIT's 4.2M sq ft Loudoun County portfolio with potential data center expansion nearby (CommercialObserver)

Arcadia buys $68M South Florida shopping center – 204,000-square-foot Pinewood Square is 99% leased with diverse tenant mix (CommercialObserver)