America‘s Commercial Real Estate Show
Transaction Volume Forecast 2025 with Jim Costello
Mar 6, 2025
Jim Costello, an experienced economist at MSCI, joins broker Michael Bull to dissect the commercial real estate landscape and the 2025 transaction forecasts. They delve into the rising transaction volumes, particularly noting a 9% increase leading into 2025. The discussion highlights the unique challenges of distressed properties, emphasizing the advantages of local developers. Additionally, they explore shifts in the office sector post-COVID and the evolving debt market, pointing out the emerging opportunities within the multifamily realm and underutilized areas.
39:33
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Quick takeaways
- Transaction volume recovery in 2024 indicates renewed investor confidence, yet remains below 2021-2022 peaks due to past low interest rates.
- Emerging opportunities in multifamily and industrial sectors are driven by demand and evolving tenant preferences amid shifting regulatory landscapes.
Deep dives
Current State of Commercial Real Estate Transactions
Transaction volume in commercial real estate showed signs of recovery in 2024, with a notable 9% increase compared to the previous year. This growth indicates a renewed confidence among investors and a shift toward a more liquid market. While there are positive trends, it's important to note that transaction volume remains below the peaks of 2021 and 2022, primarily due to the previous low interest rate environment. Analysts suggest that expectations should be tempered, as the market is stabilizing rather than returning to prior highs.
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