The Brick Breakdown

Hello Brick Brief readers, 

Thank you for your continued support. Recent developments include a new U.S.–UK trade agreement setting a 10% baseline tariff on imports, the enactment of a statewide rent cap in Washington, and continued growing concerns over housing affordability.

🇺🇸🇬🇧 Trade Policy and Real Estate Volatility
The new U.S.–UK trade agreement, which sets a 10% baseline tariff, signals a structural shift toward lasting protectionism that could increase construction and leasing uncertainty. Developers and REITs in industrial and hospitality are already facing higher material costs and slower decision-making as global market access becomes more restricted.

🏛️ Statewide Rent Control Reshapes Policy Landscape
Washington’s new rent cap law marks a major policy shift as it becomes the third state, after California and Oregon, to implement statewide stabilization. The law limits annual rent hikes to 10% or inflation plus 7%, but could discourage new development unless paired with stronger production incentives.

🏠 Affordability Divide Widens Despite Uptick in Activity

Most 2025 graduates are projected to delay homeownership until 2034, as high prices, student debt, and modest wages keep buying out of reach. Meanwhile, apartment occupancy rose to 95.7% in April as operators prioritized lease-ups over pricing, and NYC homebuying jumped 41% year over year amid seller flexibility and buyer urgency

This Week in Real Estate: Key Events & Data

Quick Markets

30Y Mortgage: 6.88% (+2 bps)
10Y Treasury Yield: 4.36% (+9 bps)
FTSE NAREIT Index: 762.36 (-0.49%)
30-day SOFR Average: 4.35%

Market Pulse

The U.S.–UK trade pact and weakening household outlook signal a shift toward long-term protectionism and rising economic anxiety, which could dampen consumer confidence and slow real estate demand

US and UK agree to new trade deal – New pact sets 10% tariff as baseline, marking a shift toward lasting U.S. protectionism and limited market access for allies (WSJ & WSJ)

Inflation expectations mixed as household outlook worsens – One-year inflation held at 3.6%, income growth expectations fell to 2.6%, and job-finding confidence dropped to 49.2%, lowest since 2021 (NYFed)

Policy & Industry Shifts

New rent caps in Washington and proposed federal land sales reflect growing government intervention in housing, aiming to expand supply and curb costs amid mounting affordability pressures

Washington enacts statewide rent control – New law caps annual rent hikes at 10% or inflation plus 7%, joining CA and OR as the third state with rent stabilization (CoStar)

House GOP pushes federal land sale for housing – New bill would sell hundreds of thousands of acres in Nevada and Utah to spur affordable housing and fossil fuel production, drawing $18B in projected revenue (Bisnow)

Residential

Despite affordability challenges and weak vacation home demand, high apartment occupancy and a surge in NYC homebuying show that buyers are still active where pricing flexibility and urgency align

Vacation home demand hits 6-year low – Second-home mortgages fell 5% in 2024 as high costs and office returns reduce buyer interest (Redfin)

Apartment occupancy jumps to 95.7% in April – Operators prioritize lease-ups over pricing, as rent growth slows to 0.2% MoM and 1.0% YoY amid economic uncertainty (RealPage)

Builders deliver smaller, cheaper homes in key metros – Median new-home prices fell in Q1 as square footage shrank, but rising tariffs on materials threaten affordability gains (Realtor.com)

Homeownership out of reach until 2034 for most 2025 grads – Student debt, high home prices, and modest salaries delay buying a home by nearly a decade post-graduation (HousingWire)

30-year mortgage rate holds at 6.76% – Rates remain near 2025 highs as trade-driven Treasury volatility and affordability hurdles weigh on spring homebuying (AP)

NYC homebuying surges 41% YoY despite tariff turmoil – Manhattan contracts jumped in April as buyers pushed ahead amid market uncertainty and more flexible sellers (Bloomberg)

Industrial

Industrial REITs hit by tariff uncertainty – Tenants delay leases and costs rise as firms like Prologis and Rexford cut spending amid trade-driven volatility (CoStar)

Market Mix

Hotel margins are under pressure from rising operating costs, while growing gym traffic reflects strong consumer demand that could soften if tariffs further squeeze discretionary spending

Hospitality

Hotel profit margins fall in 2024 – Rising labor, tech, and insurance costs outpace revenue growth, pressuring operators to cut expenses and boost efficiency (CBRE)

Retail

Gym traffic climbs in 2025 – Visit frequency and stay durationI rise across fitness tiers as consumers prioritize value, but higher tariffs may pressure future growth (Placer.ai)

Financings

Loans

Safehold, Melohn secure $167M refi for 32 Old Slip in Lower Manhattan – Goldman Sachs, Barclays, and Morgan Stanley finance ground lease on 36-story office tower owned by RXR (CommercialObserver)

Redbrick LMD secures $129M refi for NoVA multifamily – Berkadia originates $113.8M Freddie Mac loan plus $15.6M in preferred equity for 752-unit Fairfax Amberleigh Apartments (CommercialObserver)

Refinancings

MF1 provides $97M loan for Tampa student housing – Commercial Street Partners secures financing for 576-bed Apella on Newport near University of Tampa (CoStar)

Securitizations

Invesco REIT closes $1.2B CRE CLO – Largest in three years, the deal is backed by 55% multifamily and 45% industrial loans, boosting liquidity amid market uncertainty (GlobeSt)

M&A

Company M&A

CoStar’s $1.9B acquisition of Domain signals a strategic push into international markets, positioning the firm to capitalize on global housing demand and diversify beyond the U.S. real estate cycle

CoStar to acquire Australian property site Domain for $1.9B – U.S. real estate firm expands globally with full buyout of property classifieds site amid improving Australian housing market (Reuters)

Building & Portfolio M&A

Bain Capital buys $208M warehouse portfolio in Northern NJ – Firm acquired 11 light industrial buildings from Blackstone, totaling 784K SF and 88% leased (TheRealDeal)

Tishman Speyer buys Nashville apartment tower for $112M – West End property sold by Northwestern Mutual as New York firm expands multifamily footprint (BizJournals)

TGM buys 296-unit Chandler, AZ multifamily for $90.5M – New York-based firm enters Phoenix market with Ocotillo Bay acquisition from undisclosed seller (REBusinessOnline)

URS Capital buys 288-unit Summerville, SC multifamily for $58.5M – Huntington-based firm acquires newly built Palms at Edgewater near Charleston from undisclosed seller (REBusinessOnline)

Institutional Fundraising

Nuveen Real Estate raises $320M for grocery-anchored retail fund – The $1.3T AUM asset asset manager TIAA’s fund targets necessity-based centers in affluent suburbs (Bisnow)