The Best Ever CRE Show JF 4023: Fireside Chat - Rent Ceilings, Supply Shocks and Class Shifts with John Chang and Matt Faircloth
Sep 9, 2025
John Chang, head of research at Marcus Millichap with over 20 years in commercial real estate, joins Matt Faircloth for an insightful chat. They debate the future of multifamily housing, exploring rent ceilings and demand dynamics. John highlights how construction tariffs might limit supply amid rising Gen Z household formations. The discussion also touches on the potential recovery of office spaces and opportunities in hotels trading below replacement costs. They conclude with valuable insights on recession risks and the best times to build reserves or sell.
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Three Core Drivers Of CRE Markets
- Employment, demographics, and local supply are the primary drivers of commercial real estate performance.
- Monitor construction costs and labor supply as they can choke future new supply despite demand.
When Rates Become Critical
- Interest rates matter mainly when underwriting and deciding whether a deal pencils.
- Rates are driven by Fed policy plus market forces like Treasury issuance and global bond demand.
Prioritize Early Cash Flow
- Prioritize early-stage cash flow rather than relying on appreciation.
- Target deals that produce distributions quickly and avoid long waits for investor returns.
