CRE This Week - What's impacting the United States market?
March 9, 2026 - US commercial real estate news, macroeconomic indicators and market analysis.
Week of March 9, 2026
Welcome to the latest edition of CRE This Week, curated by Altus Group’s US research team.
Our team has handpicked pertinent and noteworthy market indicators, articles, original research, and significant industry dates that are critical to the US commercial real estate sector. We understand that your time is valuable, so we're excited to deliver research that helps you stay informed and saves you some time each Monday morning.
For more key economic indicators that matter to commercial real estate, see Top Indicators by Major Asset Type.
Economic print
Macro economic factors impacting CRE
S&P Manufacturing PMI and ISM Manufacturing PMI
Both major manufacturing Purchasing Managers Indexes (PMIs), released on March 2, signaled expansion in February but diverged in tone. The S&P Global Final PMI came in at 51.6, down from 52.4 in January, its seventh straight month above 50 but the weakest in that stretch, with export orders falling for an eighth consecutive month and hiring essentially flat. The Institute for Supply Management (ISM) PMI registered 52.4, just below January's 52.6 but above the 51.8 consensus, with New Orders (55.8) and Production (53.5) still firmly in expansion. The standout was ISM's Prices Index, which surged to 70.5 from 59.0, the highest since June 2022, driven by steel, aluminum, and tariff-affected imports. Employment contracted for a 29th straight month on the ISM side. The two surveys often diverge because ISM skews toward larger, globally exposed manufacturers more sensitive to trade and commodity pricing, while S&P Global covers a broader mix of mid-sized, domestically oriented firms.
Continued manufacturing expansion is supportive of industrial and logistics demand, particularly in markets tied to domestic production in machinery, chemicals, and transportation equipment. However, the sustained contraction in manufacturing employment on the ISM side limits spillover into office leasing and consumer spending. The surge in input costs is the more pressing signal for CRE: higher steel and aluminum prices, compounded by active tariffs, will continue to pressure construction budgets for industrial, data center, and other metal-intensive projects. That cost acceleration also reinforces inflation stickiness and reduces the likelihood of near-term rate relief, keeping borrowing costs elevated and limiting cap rate compression in the first half of 2026.
The Federal Reserve published its latest Beige Book on March 4, based on information collected through February 23. Seven of 12 Districts reported slight to moderate growth, but the number reporting flat or declining activity rose from four to five. Consumer spending grew slightly on balance, though uncertainty, price sensitivity, and pullbacks among lower-income households weighed on results. Manufacturing improved, with eight Districts reporting growth often tied to data center and energy infrastructure demand. Employment was broadly stable, with seven Districts reporting no change and contacts describing a "no hire, no fire" environment. Prices increased moderately, with nine Districts citing tariffs as a contributor to rising costs. Most Districts expected slight to moderate growth ahead.
Commercial real estate conditions were mixed but leaned positive. Nonresidential construction rose slightly on net, driven primarily by data center and health care projects (Cleveland, Philadelphia, Atlanta, Kansas City). Leasing showed pockets of strength: Richmond reported a "resurgence" in activity with Class A office filling up, Dallas noted solid absorption for top-tier office, and New York City saw declining vacancy and rising rents, though lower-quality space lagged. Residential sales decreased slightly in most Districts due to low inventory, affordability constraints, and winter weather. Multifamily was uneven, with elevated vacancy in Atlanta, stable conditions in Kansas City, and supply outpacing demand in parts of San Francisco. Commercial lending was the bright spot in financial services, with several Districts reporting modest growth in loan demand. Insurance, utilities, and metals remained persistent cost pressures for owners and developers.
The Bureau of Labor Statistics released the preliminary Productivity and Costs report for Q4 2025 on March 5. Nonfarm business sector labor productivity rose at a 2.8% annualized rate, well above the 1.9% consensus, as output increased 2.6% and hours worked edged down 0.2%. Q3 productivity was revised up to 5.2% from 4.9%, the strongest quarterly gain in five years. Unit labor costs rose 2.8% in Q4, above the 2.1% forecast, reflecting a 5.7% jump in hourly compensation. Manufacturing was the weak spot, with productivity falling 1.9% and unit labor costs surging 8.3%. Benchmark revisions also lifted the current business cycle productivity growth rate from 2.0% to 2.2%, driven by downward revisions to hours worked across multiple quarters in 2024 and 2025, while output was unchanged.
Stronger productivity growth eases the pass-through of wage gains into prices, which matters while core PCE sits at 3.0% year over year and the Fed holds at 3.50% to 3.75%. If the trend holds, it supports the case that the economy can sustain moderate growth without reigniting inflation, giving policymakers more flexibility to ease later in 2026. The pattern of upward revisions, driven by fewer hours worked rather than higher output, suggests firms have been getting leaner for some time, and some economists see early evidence that AI and automation investment is beginning to show up in the data. For CRE, durable productivity gains would support tenant health, corporate earnings, and the broader demand backdrop without requiring the kind of hiring surge that pushes wages and inflation higher. On the financing side, a more favorable inflation trajectory supports lower long-term yields over time, helping narrow bid-ask spreads and improve conditions for transaction and refinancing activity.
The Bureau of Labor Statistics released the February 2026 Employment Situation on March 6, showing nonfarm payrolls fell by 92,000, well below the consensus estimate of roughly 50,000 to 60,000 and a sharp reversal from January's downwardly revised gain of 126,000. The unemployment rate edged up to 4.4% from 4.3%. February marked the third month of payroll declines in the past five, and revisions turned December's previously reported gain of 50,000 into a loss of 17,000. Health care lost 28,000 positions, largely reflecting the Kaiser Permanente strike that sidelined roughly 31,000 workers during the survey week. Leisure and hospitality fell 27,000, manufacturing declined 12,000, construction lost 11,000, and information services shed 11,000. Federal government employment dropped another 10,000, extending a slide of 330,000 since October 2024. Average hourly earnings rose 0.4% month over month and 3.8% year over year, both slightly above expectations.
The headline was distorted by the Kaiser strike and severe weather, but the underlying trend is still weak. Strip out health care's one-time hit and the report shows broad-based losses across construction, manufacturing, information, and the federal sector. With five months of payroll declines over the past nine, the demand backdrop for leasing is thinning, particularly for office, where hiring in professional services, information, and government continues to contract. On the capital markets side, Treasury yields moved lower on the release and traders pulled forward expectations for the next Fed cut to July, with roughly two cuts now priced in for 2026. But wage growth at 3.8% year over year, combined with rising oil prices, keeps the Fed in a bind at 3.50% to 3.75%. For CRE, the report reinforces a market where tenant demand is softening, capital deployment stays selective, and rate relief is likely to come slowly.
News
News to know
Developer Two Roads faces a court order to rebuild a 192-unit condo tower in Miami's Edgewater neighborhood after a Florida court ruled it improperly changed building bylaws to force a buyout and demolition. The developer had gutted the 1964 property and taken on $150 million in debt to acquire it, with plans to replace it with a luxury Edition-branded tower. Restoration is estimated at $65 million. Ten holdout owners are seeking more than $100 million in damages, and over $275 million in presold units for the planned replacement project are now in limbo. The ruling raises legal risk for South Florida's longstanding condo buyout model, where developers acquire aging waterfront buildings and redevelop them as luxury projects. That pipeline has accelerated since Florida's post-Surfside safety inspection law triggered costly special assessments at older buildings, but developers may now face greater difficulty assembling full ownership, potentially slowing redevelopment timelines and shifting the risk calculus on teardown projects across the market.
The big five markets that power Fannie and Freddie's multifamily boom | GlobeSt.com, March 2, 2026
The FHFA raised Fannie Mae and Freddie Mac's 2026 multifamily loan purchase caps to $88 billion each, a 20.5% increase from $73 billion in 2025. According to Trepp, five metros account for more than 25% of the combined GSE multifamily portfolio: New York ($77.3 billion across 5,283 properties), Los Angeles ($51.0 billion), Dallas-Fort Worth ($42.5 billion), Washington, D.C. ($41.1 billion) and Atlanta ($29.6 billion), totaling roughly $241.5 billion. Freddie Mac's holdings skew toward markets with institutional sponsor participation and garden-style suburban product, with Houston ranking among its top exposures. Fannie Mae tilts more toward coastal and urban core areas with mid- and high-density infill properties. The expanded caps position GSE lending as a significant source of multifamily liquidity in 2026, particularly in large metros with deep renter bases and active refinancing and trading activity.
ULI surveyed industry economists on how the widening K-shaped economy is affecting commercial real estate. With the top 20 percent of earners driving a disproportionate share of consumer spending, luxury retail, experiential hospitality, and Class A multifamily continue to outperform, while mass-market assets face headwinds from depleted savings and stagnating lower-income wages. Experts warned that reliance on equity and real estate wealth effects to sustain consumption leaves portfolios vulnerable to asset price corrections. Moody's Thomas LaSalvia noted AI adoption is reinforcing the split by enabling employers to automate over hiring, slowing the office recovery. Several respondents urged stress-testing not just for rate scenarios but for a reversion in household wealth.
Family offices are increasingly institutionalizing their commercial real estate operations, moving from quiet co-investments in individual deals toward diversified fund structures, outside capital raises, and private equity-style platforms. Declaration Partners, anchored by Carlyle co-founder David Rubenstein's family office, raised $303 million for its second real estate fund targeting multifamily and industrial and closed a $50.1 million long-term retail lease in SoHo. Brokers and advisors noted that family offices are hiring COOs and investor relations staff, partnering with institutional capital, and in some cases originating loans directly. The shift has been most visible in South Florida, where larger development projects and continued migration of California-based offices for tax reasons are accelerating the trend. Industry participants said the move toward fund vehicles and multi-party deals offers better diversification but adds complexity, extending deal timelines and compliance requirements.
What hotels are telling us about America’s economy | Wall Street Journal, March 3, 2026
The hotel industry is reflecting three broader economic trends: growing dependence on wealthy domestic travelers, declining foreign tourism, and the outsized role of AI investment in driving demand. Revenue per available room at luxury hotels rose 9% year over year in mid-February, while economy hotel RevPAR declined. Foreign visitor numbers have dropped meaningfully, with European arrivals down 3.4%, Asian visitors off 11.7%, and Canadian visits (through November) down 16.7% compared with a year earlier. Las Vegas saw visitor numbers fall 7.5% in 2025, the largest non-pandemic decline since records began in 1970. Hotels near major data center construction sites, such as in northern Louisiana, have been a notable exception, benefiting from AI infrastructure spending. The upcoming World Cup, co-hosted across 11 U.S. cities, will test whether foreign tourism appetite recovers after a year of tighter visa rules and geopolitical tension.
Builders oppose Senate housing bill over investor ban provision | Bloomberg, March 4, 2026
The National Association of Home Builders came out against the Senate's housing bill, the most significant housing legislation in over a decade, over a White House-negotiated provision restricting institutional investors from buying single-family homes. While build-to-rent homes were largely exempted from the ban, the bill requires investors to divest such properties within seven years, a condition NAHB says introduces enough uncertainty to discourage financing and development. The Senate cleared a procedural vote 90-8, with final passage expected next week. NAHB's chief advocacy officer noted that the seven-year divestiture requirement diverges from Trump's January executive order, which exempted build-to-rent without a sunset provision. Senate Banking Committee Chairman Tim Scott said the investor ban was central to securing White House support for the broader package.
Assisted living penetration hinges on more than demographics | GlobeSt.com, March 4, 2026
An analysis of 99 markets by the National Investment Center for Seniors Housing & Care (NIC) found that assisted living penetration rates vary widely and are driven by a combination of economic conditions, workforce capacity, cultural norms, consumer awareness and regulatory environments rather than senior population size alone. Markets with similar demographics can produce dramatically different adoption rates depending on whether these factors align. Minneapolis and Portland, with penetration rates of roughly 10.1% and 7.5%, reflect regions where economic capacity, staffing and familiarity with senior housing converge, while Miami and Las Vegas sit at just 2.4% and 1.9% despite large senior populations. NIC also noted that higher care needs do not automatically produce higher penetration, as caregiver shortages, affordability constraints and cultural preferences for in-home care can suppress adoption even in high-need areas.
Why private credit panic likely won't spread to real estate debt | Bisnow, March 5, 2026
AI-driven repricing fears are rattling the $2 trillion private credit market, but real estate debt appears largely insulated due to its asset-backed structure. Recent losses have been concentrated in corporate and software lending rather than property-secured debt. Debt funds now hold 13% of the $4.8 trillion U.S. CRE mortgage market, up from a 9% average during 2015 to 2019. AI-related loans account for about 8% of outstanding private credit and could double to $600 billion by 2030, according to the Bank for International Settlements. Balance sheet lending spreads on lower-leverage office loans widened in February, potentially reflecting concern over AI-driven headcount reductions. Private real estate lenders point to shorter loan terms and physical collateral as structural protections, though underwriting is increasingly factoring in AI disruption risk across property types.
INSIGHTS Spotlight
Catch the latest research and insights from Altus
Article | US CRE transaction analysis – Q4 2025
For the first time since 2022, every major CRE property type posted positive price gains in every quarter of the year.
Median price per square foot has climbed 58.5% from just before the pandemic to Q4 2025, with each sector getting there in its own way. After a rough few years, the last quarter of 2025 conveyed a theme of recovery for US CRE.
In our full-year 2025 US CRE transaction analysis, Omar Eltorai and Cole Perry break down the indicators of recovery for each major sector, and where the divergences get interesting.
Podcast | 560 billion reasons the US CRE market is finding its footing
The CRE market didn't roar back in 2025. It did something more important: it stabilized. Omar Eltorai and Cole Perry, are joined by valuation and performance experts Phil Tily, Alexander Jaffe, MAI, and Michael Amthor to walk through the full-year 2025 picture using both Altus’ US CRE transaction data and the Altus analysis of the ODCE Index.
Key takeaways:
Industrial: Institutional capital appears to be concentrating on large-format logistics; smaller deal activity has notably slowed
Retail: Investors are increasingly drawn to mark-to-market lease opportunities, a thesis with similarities to what drove industrial interest five years ago
Office: Asset-specific events are now the primary driver of value movement, with broad market-wide repricing appearing to have largely run its course
Apartments: Sunbelt softening, gateway resurgence, and rising expenses are influencing the return profile across the sector
Important dates
Upcoming data releases and events
Data releases (Times in EST)
Tuesday, March 10
6:00AM: NFIB Small Business Optimism Index (Feb.)
10:00AM: Existing Home Sales (Feb.)
Wednesday, March 11
8:30AM: Consumer Price Index (Feb.)
2:00PM: Monthly U.S. Federal Budget (Feb.)
Thursday, March 12
8:30AM: U.S. Trade Deficit (Jan.)
8:30AM: Housing Starts (Feb.)
8:30AM: Building Permits (Feb.)
Friday, March 13
8:30AM: GDP (First Revision) (Q4)
8:30AM: Personal Income (Jan.)
8:30AM: Personal Spending (Jan.)
8:30AM: PCE Price Index (Jan.)
8:30AM: Durable Goods Orders (Jan.)
10:00AM: Job Openings (Jan.)
10:00AM: University of Michigan Consumer Sentiment Index (Prelim) (Mar.)
Upcoming industry events
March 9 – March 11: Retcon 2026 (Las Vegas, NV)
March 16 – March 19: NCREIF Spring Conference (Scottsdale, AZ)
March 24 – March 27: ARES Annual Conference (Sandestin, FL)
March 24 – March 26: NAREIT REITwise (Hollywood, FL)
March 24 – March 26: Shoptalk Spring (Las Vegas, NV)
March 26 – March 27: PREA Spring Conference (Nashville, TN)
About our research team
Omar Eltorai
Senior Director of Research
Altus Group
Omar Eltorai is a Research Director at Altus Group. With more than a decade of experience in the industry in investment management and financing roles,
Omar's focus is on macro, capital and market trends affecting the US CRE market. Beyond regularly authoring articles and reports, his commentary and analysis has been featured in various media publications, including: Wall Street Journal, Globe Street, and Yahoo! Finance.
Cole Perry
Associate Director of Research
Altus Group
Cole Perry is a Associate Director of Research with Altus Group's Research team. In this role, Cole delivers key insights into macroeconomics, capital markets, and the broader commercial real estate sector.
Cole boasts a rich background in Commercial Real Estate analytics with previous roles at CompStak and Brixmor Property Group. He holds dual M.S. degrees from Columbia University in Urban Planning and Real Estate Development.
Disclaimer: The opinions expressed in this newsletter are solely those of the authors and are not endorsed by Altus Group Limited, its affiliates and its related entities (collectively “Altus Group”). This publication has been prepared for general guidance on matters of interest only and does not constitute professional advice or services of Altus Group. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy, completeness or reliability of the information contained in this publication, or the suitability of the information for a particular purpose. To the extent permitted by law, Altus Group does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it. The distribution of this publication to you does not create, extend or revive a client relationship between Altus Group and you or any other person or entity. This publication, or any part thereof, may not be reproduced or distributed in any form for any purpose without the express written consent of Altus Group.
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