The CRE Weekly Digest by LightBox

This week’s slate of economic data left pundits divided even as investors cheered on rising markets. Retail sales surprised to the upside, inflation was muted, and bank earnings beat forecasts. However, deeper trends raise caution: tariff receipts are surging, homebuilders are cutting prices, and the Trump–Powell standoff briefly rattled equity and bond markets.Manus remains bullish yet uneasy, warning that someone is absorbing billions in monthly tariff costs, and the bill may soon come due. Dianne points to the mixed results of the LightBox sentiment survey and leans on Jamie Dimon’s line this quarter: “forecasting is a waste of time.”The LightBox Appraisal Index rose in Q2 on retail and industrial demand, but cost uncertainty still looms. Industrial sector activity continued with big bets from Brookfield, Prologis, and Blackstone. Office continues to struggle evidenced by a round of transactions with Portland’s “Big Pink” tower selling at an 88% haircut. And outside the CRE market, the team weighs in on reports of Delta's AI-powered ticket pricing. What are your thoughts?We want your take. LightBox is about to close the Midyear 2025 CRE Market Survey and we want to hear from experts like you across valuation, due diligence, lending, investment, and brokerage. We’re exploring your reflections on the first half of 2025 and your outlook for the months ahead. Click here to take the survey > The survey closes EOD Friday, July 18th, and we’ll be sharing the results shortly thereafter.02:51 Tariffs and Inflation Impact09:01 Trump-Powell Tensions12:00 LightBox Lender Appraisal Insights14:59 Big Transactions in Industrial Real Estate18:02 Office Market Challenges20:46 Infrastructure Plays for Data Centers24:01 Retail to Industrial Transformations26:49 The AI Price is Right?Have questions for the pod team? Send them to Podcast@LightBoxRE.com.www.lightboxre.com

David Putro, Head of Analytics for Morningstar Credit, doesn’t sugarcoat it. In this candid conversation with the LightBox team, he offers an unflinching look at where distress is building in commercial real estate and why resolution is moving at a crawl. With a sharp focus on office, multifamily, and malls, David explains why this cycle is unfolding slower than the last, and why some properties may never exit special servicing. From billion-dollar loans stuck in limbo to zombie malls surviving on post-COVID extensions, he lays out the long road ahead for asset resolution.  The picture of growing distress offers a stark counterpoint to the healthy surge in CMBS lending so far in 2025.  So, what gives?David breaks it all down and shares what Morningstar’s “Boots on the Ground” research reveals that spreadsheets miss (think vacancy patterns, tenant quality, and hidden red flags that influence recovery timelines). Don't miss David’s outlook on where distress is headed for the rest of 2025, why office assets remain frozen, and what really keeps credit pros like him up at night (spoiler: it’s not just interest rates).00:55 Market Paradox: CRE Distress and CMBS Issuance02:05 Challenges in Multifamily and Office Sectors03:49 CMBS Purgatory and Loan Resolutions10:59 Mall Distress and Adaptive Reuse20:07 Boots on the Ground: Real Estate Insights27:08 Future Outlook and ConcernHave questions for the pod team? Send them to Podcast@LightBoxRE.com. www.lightboxre.com

It’s halftime in 2025, and The CRE Weekly Digest team is back with a data-driven gut check on a market that’s proving more resilient than expected. Despite tariff shocks, geopolitical tension, and consumer gloom, CRE hasn’t blinked. In fact, capital is flowing, transaction volume is up, and nine-digit retail deals are making a surprise comeback.Manus sees signs of a second half surge, powered by engaged lenders, an expanding buyer pool, and the long-awaited return of Big Tech to the office market. Dianne flags soft spots, namely inflation pressure, GDP drag, and the retail sector’s tariff exposure, but concedes this market doesn’t rattle easily.The team also breaks down the latest CRE Activity Index, big bets from Apple, and whether fireworks should be tariff-exempt in the Big Beautiful Bill. The collective forecast: proceed, but don’t skip due diligence.And in true Digest fashion, they close with song picks that capture the CRE mood: Van Halen, Mumford & Sons, and a dose of Kelly Clarkson.We want your take. LightBox just launched the Midyear 2025 CRE Market Survey to hear from experts like you across valuation, due diligence, lending, investment, and brokerage. We’re exploring your reflections on the first half of 2025 and your outlook for the months ahead. Click here to take the survey >  The survey closes Friday, July 18th, and we’ll be sharing the results shortly thereafter. 01:09 Market Resilience and Key Takeaways05:35 Lightbox CRE Activity Index Analysis10:15 Transaction Trends and Big Deals13:21 Interest Rates and Fed Meetings19:57 Selective Hiring Trends and Labor Market Insights22:04 Optimism and Reservations for the Second Half31:20 Sector Rapid-Fire Forecasts: Office, Multifamily, Industrial, and RetailHave questions for the pod team? Send them to Podcast@LightBoxRE.com.www.lightboxre.com

It’s a milestone week at The CRE Weekly Digest—our one-year anniversary and 52nd episode. From launch day to today, we’ve unpacked the headlines, challenged assumptions, and surfaced the trends that matter most for CRE professionals navigating uncertainty. This episode is no different. Markets are running hot, with stocks brushing all-time highs despite risks from Middle East volatility to tariff headwinds and the Powell–Trump standoff. Is it optimism or selective amnesia? Manus calls it like he sees it, with Dianne and Martha weighing in on rate cut speculation, earnings compression, and investor fatigue.In CRE, conviction is showing up in the form of major bets: a $211M construction loan in Miami’s Edgewater, a Manhattan office-to-resi conversion, and a surge in data center demand, even as zoning friction and energy strain rise. Cincinnati tops rent growth rankings, and Walmart experiments with dark stores and drone delivery.We also give an advance look at the latest LightBox CRE Activity Index and spotlight the metros showing real momentum in environmental due diligence.And finally, a big thank you to our listeners—from NYC to Singapore—for showing up, weighing in, and pushing the conversation forward every week. Here’s to the next 52 episodes.00:52 Geopolitical Tensions and Market Reactions07:03 Interest Rates and Economic Outlook12:29 New York City Mayoral Election and Potential Fallout19:14 The Rise of Data Centers in the AI Era24:57 Gyms are Back and Part of the Amenity Draw27:39 Bold Moves in Multifamily and Office-Resi35:11 Innovations in Retail: Dark Stores and Drone Delivery37:00 Celebrating One Year of Insights with the Pod TeamHave questions for the pod team? Send them to Podcast@LightBoxRE.com. www.lightboxre.com

What does it take to make a property—and a team—resilient in today’s volatile CRE landscape? Holly Neber, Chief Resilience Officer at AEI Consultants, joins the LightBox team to unpack the rising urgency around climate risk, insurance hurdles, and resilience planning. A 30-year environmental veteran and chair of the ASTM task group behind the industry’s first Property Resilience Assessment (PRA) guide, Holly breaks down how stakeholders are turning climate risk into actionable insight—before it derails deals or distorts value. From PRAs and insurance blow-ups to investor ‘walk-aways’ and model fatigue, Holly gives a masterclass in what CRE pros need to know now. She explains why resilience isn’t just physical—it’s cultural—and why the next wave of opportunity will belong to those who can identify risk and adapt. Don’t miss her insight on lender vs. investor expectations, how climate risk is already showing up in property pricing, and the mindset shift she sees among the next generation of consultants. This one’s packed with clarity, candor, and a forward-looking vision CRE needs right now. 01:15 Understanding Property Resilience04:54 Climate Risk and Insurance Challenges05:32 The ASTM Property Resilience Assessment Guide09:37 Investor and Lender Perspectives on Climate Risk14:37 Holly Neber's Journey and Leadership16:13 Impact of Climate Risk on Property Valuation26:50 Managing and Inspiring Teams29:58 The Evolution of Environmental Site AssessmentsHave questions for the pod team? Send them to Podcast@LightBoxRE.com. www.lightboxre.com

Inflation cools, tariff tensions ease, and investors start breathing a little easier, but is CRE catching a tailwind? The team digs into surprisingly positive CPI and PPI reports, unpacking why the market's fears may have overshot reality for now. With the May LightBox CRE Activity Index posting its first monthly decline of the year, the big question is whether this is a blip or the beginning of a new trend. Meanwhile, the conversation shifts to headlines shaking up sentiment: civil unrest in L.A., a federal ruling on eviction bans, and a proposed FEMA shutdown that could upend disaster recovery and reshape pricing in high-risk markets. As construction costs face new labor pressures and the Fed stays in wait-and-see mode, the team weighs what it all means for commercial real estate’s second half. On the ground, not all markets are slowing, Florida still has some upside, with luxury apartments trading hands at a premium and retail/hotel deal volume picking up steam. And in the office sector, a milestone moment: for the first time in 25 years, more space is being demolished or converted than built. The outlook? Cautiously optimistic. Or, as Manus puts it: “We went four for four this week—and that’s reason to feel good.” Also on the radar: socks, three-woods, and why a bagel might just be the best Father's Day gift of all.00:46 Macroeconomic outlook: CPI, PPI, and tariffs 06:16 LA Spotlight: CRE implications 09:35 Eviction bans, rent caps & regulatory risk 13:51 FEMA phase-out: Resilience and rebuilding 16:04 LightBox May CRE Activity Index Dips 22:05 Office conversion trends & market bifurcation 28:00 Multifamily, retail, hotel: The dogs are hunting 30:37 South Florida trophy deals, Father's Day forecasts & more Have questions for the pod team? Send them to Podcast@LightBoxRE.com.www.lightboxre.com

CMBS workouts aren’t for the faint of heart—and CMBS expert Shlomo Chopp knows it better than most. With 20+ years of experience untangling distressed assets, Shlomo offers a rare, unsparing look into what borrowers, bondholders, and even AAA investors often get wrong. From why “non-recourse” loans aren’t always what they seem to how banking can relationships collapse under pressure, Shlomo lays out why CMBS is a different beast—and why many borrowers walk in unprepared. He dives into tranche warfare, special servicers, and the dangers of relying on outdated property values.For bondholders, the takeaway is clear: think like real estate professionals. If you're not walking the property and talking to brokers, you're already behind. Stay to the end to hear a sneak peek of Shlomo’s patented micro-fulfillment retail centers—aimed at reviving malls by merging e-commerce with in-store logistics.This episode is part finance class, part war story, and a must-listen for anyone trying to read between the lines of CRE distress.01:13 Understanding CMBS Borrowers and Their Motivations03:19 Recourse vs Non-Recourse Loans in CMBS07:36 Complexities of CMBS Trusts and Workouts11:25 Navigating Distress in CMBS Investments15:17 The Importance of Market Awareness for Investors25:20 Understanding Market Dynamics and Credit Risk29:38 Current State of the Distress Cycle32:43 The Evolution of Retail in the E-Commerce EraHave questions for the pod team? Send them to Podcast@LightBoxRE.com.www.lightboxre.com

Markets may have cheered a court ruling limiting presidential tariff power—but don’t mistake it for clarity. The LightBox team—Martha Coacher, Manus Clancy, and Dianne Crocker—unpacks what’s really moving CRE: supply chain strains, shaky retail guidance, and tariff whiplash. Retailers are pulling forecasts, investors are fatigued, and Manus warns we’ve moved “from panic to complacency” way too fast. Still, CRE activity remains resilient. LightBox data shows strong listing volumes and investor interest, with more than 130 NDAs per deal on average. Plus: a rare $865M hotel deal, a bullish $535M multifamily buy in Atlanta, and a surge in law firm office leasing. The team also dives into the latest twists in New York’s rent stabilization saga—and whether bathing suits might be the new eggs.02:49 Investor Sentiment and Market Complacency06:04 Retail Earnings and Tariff Impact11:34 CRE Activity and Market Trends13:38 Noteworthy Sales in Multifamily Sector22:35 The Impact of Rising Interest Rates on Multifamily Loans27:37 Challenges in Rent Stabilization and Property Management30:58 Positive Trends in Office Space Leasing36:10 Emerging Trends in Retail and E-commerceHave questions for the pod team? Send them to Podcast@LightBoxRE.com. www.lightboxre.com

How are regional banks navigating today’s choppy economic and federal policy waters? The LightBox team gets an inside look when they talk to Matthew Osborne, EVP and Chief Credit Officer at Eastern Bank – a regional bank in the Boston MSA.  Matt explains why Boston’s chronic housing shortage is helping multifamily remain a magnet for capital, even as affordability pressures rise, and how a VC-fueled life sciences boom led to today’s glut of vacant lab space. His detailed breakdown of venture funding cycles, tenant demand, and submarket saturation is a must-listen for anyone tracking the life sciences and lab asset space. He also weighs in on why the market feels different this time, how lenders are stress-testing capital stacks, and what Boston’s biggest distressed office sale signals about future valuations. Plus, a black swan watch, a musical cameo, and why Here Comes the Sun might just be the theme song for 2025 lending.01:10 Key Concerns in CRE Lending03:22 Industry Sentiment and Market Cycles08:48 Boston's Multifamily Market and Housing Shortage14:58 Office to Residential Conversions in Boston23:13 Life Sciences and Lab Space in Boston33:46 Industrial Sector InsightsHave questions for the pod team? Send them to Podcast@LightBoxRE.com. www.lightboxre.com

What separates good brokers from great ones? In this special episode, Martha, Manus, and Dianne chat with two titans of CRE sales—Bob Knakal and Rod Santomassimo— who get real about what it takes to succeed, scale, and stay relevant across decades of market cycles. From the grind of daily prospecting to the power of knowing what the market data means, they break down the 3 characteristics of top producers.Bob shares how his famed Map Room went from pandemic project to competitive differentiator, and why discipline, obsession, and a highlighter can be the components of long-term success. Rod explains why AI is changing the CRE sales game—but not replacing grit—and how their collaboration on a new book Selling Buildings is part memoir, part masterclass.  If you’re in the CRE capital markets – this is a must-listen with healthy doses of entertainment along the way.And stick around for the end, when the conversation takes a turn: who would play Bob and Rod in the movie version of their CRE journey?03:02 What Separates Good Brokers from Great Ones?07:07 The Map Room Origin Story Redux12:58 The Mindset of Success in Brokerage18:16 The Power of Visualization in Real Estate21:05 Navigating Challenges: Lessons from the Field24:00 Resilience in Tough Times: Advice for Brokers26:54 AI and the Future of Real Estate34:10 Leaving a Legacy: The Importance of MentorshipHave questions for the pod team? Send them to Podcast@LightBoxRE.com. www.lightboxre.com