Hello Brick Brief readers, 

Thank you for your continued support! Today we’re seeing December rate cut odds rise as weak October job data strengthens easing expectations, CRE lending rebounds on stabilizing borrowing costs, and subscale multifamily REITs explore sales or liquidations to unlock value.

📉 Job Cuts Strengthen Rate-Cut Bets
Softening labor data is fueling confidence in a December Fed rate cut. U.S. firms cut roughly 11,000 jobs per week through late October, which led traders to push 10-year Treasury yields down to 4.08% and reprice the odds of a 25 bps cut to 67.9%.

💰 CRE Lending Rebounds on Easing Rates
Stabilizing borrowing costs and tighter spreads fueled loan closings and revived deal activity across asset classes. CBRE’s Lending Momentum Index climbed 112% YoY in Q3 as banks originated $227B in new loans and data center debt surged 720% to $28B, marking the strongest quarter since 2018.

🏢 Subscale Multifamily REITs Pursue Exits
Subscale REITs are trading at steep discounts due to limited scale, weak liquidity, and scarce growth capital, allowing private buyers to acquire quality assets at depressed valuations. $1.1B-listed multifamily REIT Centerspace, which owns assets across the Mountain West and Upper Midwest, and $813M multifamily REIT Aimco are exploring sales or liquidations to unlock shareholder value in an oversupplied environment.

30Y Mortgage: 6.34% 

10Y Treasury Yield: 4.08% (-4 bps) 

WSJ Prime Rate: 7.25%

FTSE NAREIT Index: 775.54 (+1.03%) 

30-day SOFR Average: 4.16%

Markets are growing more confident in a December Fed rate cut, after U.S. firms cut 11,000 jobs per week through late October, which led traders to push 10-year Treasury yields down to 4.08% and price in a 67.9% probability of a 25 bps move.

U.S. firms cut 11,000 jobs per week through late October – ADP data signaled further labor market weakness and strengthened expectations for another Fed rate cut in December (Reuters)

Treasuries rose as 10-year yields fell to 4.08% – Weak labor data fueled bets for a December Fed rate cut (Bloomberg)

U.S. government shutdown nears end – The Senate passed a temporary funding deal backed by Trump to reopen most agencies through January as the House prepares a final vote after a record 42-day closure (Bloomberg)

U.S. multifamily fundamentals softened in Q3 as new supply continued to flood the market and rent growth cooled. According to RealPage, national apartment rents fell 0.7% YoY in October, the third consecutive monthly decline, while occupancy slipped to 94.9%. GlobeSt reported that only 11 markets saw absorption outpace new supply in Q3 as completions surged, with Sun Belt and Mountain West metros bearing the brunt of rent cuts. High-barrier markets such as San Francisco and New York, meanwhile, saw renewed rent gains as new deliveries slowed. Bisnow noted that analysts expected rent growth to rebound by late 2026 as the pipeline tightened, but near-term pricing power remained weak.

🧱 Centerspace Weighs a Sale
$1.1B apartment REIT Centerspace is exploring a potential sale as it fields takeover interest. Centerspace owns about 13,000 units across the Western U.S., concentrated in Denver, Salt Lake City, and smaller markets such as Grand Forks, ND; Billings, MT; and Rapid City, SD. Its shares rose 12% on the report. 

🧱 Aimco Plans Full Liquidation
$813M-listed Apartment Investment and Management Co. (Aimco) plans to liquidate its remaining portfolio and return proceeds to shareholders after a yearlong strategic review. The Denver-based company will sell 15 stabilized properties and several development sites across New York, Georgia, Illinois, California, Tennessee, and Florida, including a $520M Miami waterfront portfolio and expects to distribute between $5.75 and $7.10 per share. Aimco’s decision follows its 2020 spin-off of AIR Communities, which Blackstone took private for $10B last year, and reflects management’s conclusion that liquidation offers greater shareholder value than operating as a subscale public company.

🧱 Multifamily REITs Under Pressure
Elevated construction, slower absorption, and weak rent growth have created challenging conditions for smaller apartment REITs. Many trade below net asset value as higher interest rates and limited liquidity constrain growth capital and compress returns. Public landlords without scale or external capital pipelines are finding it increasingly difficult to compete, prompting sales and wind-downs across the sector as private buyers step in to capture acquire high-quality assets at cheap prices.

Takeaway: Subscale REITs are trading at steep discounts due to limited scale, weak liquidity, and scarce growth capital, allowing private buyers to acquire quality assets at depressed valuations. Publicly traded stocks, including REITs, must show growth in order to trade at higher valuations. Centerspace and Aimco’s strategic are examples of how smaller multifamily owners are struggling to prove growth in an environment defined by heavy supply, slow absorption, and muted rent gains and why some are choosing to liquidate their assets to unlock immediate shareholder value. This news follows a string of recent smaller multifamily REIT sales I’ve recently covered, including Elme Communities ($1.6B) and Dream Residential ($350M)

CRE lending momentum hits 7-year high – CBRE’s Lending Momentum Index jumped 112% YoY in Q3 as stabilizing borrowing costs and tighter spreads fueled loan closings and revived deal activity across asset classes (ConnectCRE)

Bank CRE lending rebounds to 2019 levels – Loan originations hit $227B, up 85% YoY, as easing rates revive deal activity and data center debt surges 720% to $28B (Bisnow)

Connecticut revives major housing bill – Lawmakers reached a compromise to expand housing supply by incentivizing construction while preserving local zoning control and easing parking mandates (Homes.com).

Trump’s 50-year mortgage proposal loses momentum – Housing experts warn the plan offers minimal savings, doubles interest costs, and limits equity growth, while lenders are unlikely to back non-qualified long-term loans (Bloomberg)

U.S. apartment fundamentals remain soft as rents fell 1% nationally and cap rates rose to an eight-year high of 5.63%, but with supply down nearly 50% since 2021, conditions are setting up for stronger rent growth by late 2026

U.S. apartment transaction volume rose 13% YoY to $43.8B in Q3 2025 – Cap rates climbed to 5.63%, the highest in eight years (RealPage)

95% occupancy and easing supply steady multifamily market – Units under construction are down nearly 50% since 2021, positioning fundamentals for stronger rent growth in 2026 (Colliers)

Rents fall 1% nationally as new supply leases up – Landlords face short-term pricing pressure, but tightening pipelines point to a rebound by late 2026 and 2027 (Colliers)

Capital flows stay strong despite higher rates – Banks, agencies, and CMBS lenders remain active as rebalancing fundamentals attract sidelined investors back to multifamily (Colliers)

Workforce housing rents surge 20% since 2021 – Investors drive steep rent hikes in low-income markets like Seattle (+38.5%) and Atlanta (+19.8%) as affordability pressures mount nationwide (GlobeSt)

Big-box vacancy holds near 11% as construction drops 67% from 2022 highs – Supply and demand are rebalancing, with 41M SF absorbed in H1 2025 and rents stabilizing at $8.55/SF (Colliers)

Big-box construction finds its floor at 112M SF across North America’s top 20 markets – New leasing is set to rebound as economic clarity returns, positioning the sector for renewed growth (Colliers)

U.S. retailers absorbed 4.7M SF in Q3 – Tight construction and surging demand for small-format spaces from QSRs and dollar stores fueled the market’s rebound (JLL)

Denny’s goes private under TriArtisan, Treville, and Yadav – The diner chain faces a 6.2% YoY traffic decline but retains strong loyalty, giving new owners room to reposition and rebuild long-term growth (Placer.ai)

Starwood’s Barry Sternlicht says AI will replace employees as data center investments surge – The Starwood Capital CEO warned AI could cut staffing needs while confirming $20B dedicated to data centers leased to hyperscalers like Amazon and Oracle (CNBC)

Luxury hotel demand hits new highs – Wealthy travelers are splurging on premium resorts and grand hotels as record room rates fail to slow bookings (WSJ)

Kennedy Wilson and Fairfax Financial provide $78M construction loan for multifamily project Arbor House in Palm Beach Gardens, FL – Abacus Capital secured the financing for the 13-story, 302-unit development, which broke ground at the PGA Station mixed-use site (TheRealDeal)

Blackstone provides $220M refinancing for two multifamily towers at 268 Lorimer Street in Brooklyn, NY – A JV of The Loketch Group, Joyland Group, and Meral Property Group used the five-year fixed-rate loan with CenterSquare participation to retire $172M in prior debt (CommercialObserver)

Manulife’s John Hancock provides $80M refinancing for multifamily tower Gracie Mews in New York, NY – Jack Resnick & Sons secured the 10-year fixed-rate loan for the 35-story, 310-unit Upper East Side property (CommercialObserver)

Citibank provides $66M CMBS refinancing for Fairfield Inn & Suites at 538 West 58th Street in New York, NY – McSam Hotel Group secured the loan to fund capital improvements for the 224-key Midtown hotel (CommercialObserver)

Japanese insurer Tokio Marine will acquire a majority stake in $18B CRE lender Acore Capital – The deal expands Tokio’s U.S. real estate credit footprint (Bisnow)

$1.1B apartment REIT Centerspace is exploring a sale – The landlord owns 13,000 apartment units across Western U.S. markets including Denver, Salt Lake City, Grand Forks, ND, and Billings, MT (Bloomberg)

$813M-listed multifamily REIT Aimco plans full liquidation – The Denver-based firm will sell all remaining assets, including a $520M Miami waterfront portfolio, and return proceeds to shareholders after a strategic review (Bisnow)

Quadrum Global is exploring a sale of boutique hotel chain Arlo Hotels – The firm operates seven properties catering to budget-conscious urban travelers in New York, Miami, and Washington, including the former Williamsburg Hotel it bought for $96M in 2023 (Bloomberg)

Eagle Partners acquires The Hills at Hacienda Heights apartments in Los Angeles, CA for $107M – The firm partnered with Red Stone Equity Partners, J.P. Morgan Chase, CalHFA, and Affordable Housing Access to convert the 350-unit complex into affordable housing (CommercialObserver)

Island Capital lists Lexington Hotel in New York, NY for $275M – Andrew Farkas’ firm and JV partners Three Wall Capital and MCR are marketing the 725-key Midtown East property, which last traded for $185M in 2021 (TheRealDeal)

South Street Partners JV acquires Sawgrass Marriott Golf Resort & Spa in Ponte Vedra Beach, FL for $149M – The JV with Dream Finders Homes and Diamond Baseball Holdings bought the 514-key resort from Carey Watermark Investors and plans a full renovation (ConnectCRE)

Developer lists bankrupt Downtown Miami, FL hotel site for $175M – The 1-acre property with a 200-room Holiday Inn includes approvals for an 82-story mixed-use tower with 374 residential units and 120 hotel rooms (CommercialObserver)

Hines and Rialto target Hilson’s Midtown, NY office portfolio for foreclosure – The partners acquired $100M in loans from Flagstar Bank tied to 185 Madison Avenue, 5 West 37th Street, and 349 Lexington Avenue and filed to auction the properties (TheRealDeal) 

Fractional real estate platform Arrived raises $27M – The single-family rental startup backed by Bezos Expeditions and tech CEOs has now raised $60M and manages 550 homes across 65 U.S. markets (Bisnow)

D.R. Horton adopts AI proptech platform from Prophetic to streamline land acquisition – The Texas-based homebuilder will use the software to analyze zoning, parcel data, and environmental factors to accelerate subdivision planning across more than 20 states (TheRealDeal)