CRE This Week - What's impacting the United States market?
January 19, 2026 - US commercial real estate news, macroeconomic indicators and market analysis.
Week of January 19, 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
NFIB Small Business Optimism Index
NFIB Small Business Optimism Index: The National Federation for Independent Business released its Small Business Economic Trends Report for December 2025 on January 13, 2026. The report showed a modest 0.5-point increase in the headline Small Business Optimism Index to 99.5, keeping the index above its 52-year historical average of 98 and marking the second consecutive monthly gain. The improvement was driven largely by a stronger outlook for future business conditions, while the Uncertainty Index fell 7 points to 84, its lowest reading since mid-2024. Of the 10 index components, two improved, three declined, and five were unchanged. Despite the gains in sentiment, taxes remain the top concern for owners, with inflation and labor quality continuing to pose challenges.
The slight uptick in small business optimism suggests Main Street firms are cautiously upbeat heading into 2026, supported by easing cost pressures and expectations for improved economic conditions. This points to the potential for steady consumer demand and moderate hiring activity, while lower uncertainty may encourage more confident investment decisions even as tax and labor issues persist. For commercial real estate, firmer small business sentiment could help sustain demand for smaller office spaces, retail storefronts, and light industrial facilities as firms weigh expansion and capital spending. That said, ongoing hiring difficulties and cost pressures may still limit demand growth in markets closely tied to local labor conditions, making it important for owners, lenders, and investors to watch whether improving sentiment translates into durable revenue growth and stable tenant performance in early 2026.
The Bureau of Labor Statistics released the Consumer Price Index (CPI) for December 2025 on January 13, showing headline inflation running at 2.7 percent year over year, with prices up 0.3 percent month over month. Core CPI, which excludes food and energy, increased 2.6 percent annually, indicating that underlying inflation pressures remain present but relatively stable.
For the broader economy and commercial real estate, this mix keeps the Fed in a balancing act. Inflation is still elevated, but a softening labor market gives policymakers room to consider rate cuts without waiting for inflation to fully return to target. At the same time, shelter inflation has shifted from an inflation driver to an anchor. CPI Rent of Primary Residence rose 2.9 percent year over year, well below pre pandemic averages, and because shelter carries roughly a 30 percent weight in CPI, slowing rent growth is now pulling down overall inflation. For CRE owners and investors there are two important points in the data: while reported CPI rent lags real time leasing conditions, easing shelter inflation reduces the risk that interest rates need to stay higher for longer, even as rent growth expectations normalize.
New Home Sales and Existing Home Sales
The U.S. Census Bureau and Department of Housing and Urban Development released the New Residential Sales Report for October 2025, on January 13, 2026, delayed due to the Federal Government shutdown. Sales of newly built single-family homes remained relatively strong in October, with the seasonally adjusted annual rate (SAAR) at 737,000 units, virtually flat month-to-month but showing a solid year-over-year increase of about 18.7 %. The median sale price of new homes was $392,300, down roughly 8% from October 2024 and modestly lower than September’s figure. Inventory levels held near 488,000 units, translating to roughly 7.9 months’ supply at current sales rates, a level that historically eases affordability constraints for buyers.
The National Association of Realtors released the Existing-Home Sales Report for December 2025 on January 14, 2026, showing that existing-home sales rose 5.1 % in December to a SAAR of 4.35 million units, the strongest monthly pace in nearly three years. On an annual basis, sales were up about 1.4 % year-over-year, suggesting a modest stabilization after several years of sluggish activity. The median existing-home price was $405,400, a 0.4 % increase versus year-ago levels and marking over two years of year-over-year price gains. Inventory remains constrained at around 1.18 million units with about 3.3 months’ supply, a tight level that continues to support price resilience.
Despite covering different periods, the two releases together reinforce the view that single-family housing demand is beginning to soften. The combination of a sharp year-over-year increase in new-home sales and a meaningful decline in new-home prices suggests builders are relying more on price cuts and buyer incentives to pull demand forward, rather than responding to a genuine surge in underlying demand being redirected from the resale market. For the broader economy, this raises questions about the durability of household balance sheets. Even so, single-family home prices remain near cyclical highs, continuing to provide baseline support for multifamily demand.
The US Census Bureau released its advance estimates for retail and food service sales for November 2025 on January 14, 2026, showing that sales rose 0.6% month over month in November to roughly $736 billion, rebounding from a revised 0.1% decline in October. Sales were up about 3.3% from a year earlier. Retail trade excluding food services also increased 0.6% on the month. When autos are excluded, sales rose a more modest 0.4%, pointing to steady but not accelerating goods demand. Excluding both autos and food services, core retail spending still advanced, signaling resilience in underlying consumer activity despite easing labor momentum.
November’s retail sales data reinforce that consumer spending remained a key source of economic support late in 2025, helping sustain near-term growth even as other indicators soften. For commercial real estate, steady core retail sales support tenant revenues across shopping centers and service-oriented retail, while continued gains in food services bode well for restaurant and experiential space. That said, the slower pace of growth outside autos and dining suggests consumers are becoming more selective, which could pressure discretionary retailers and reinforce a bifurcation between necessity-based retail and more cyclical formats.
News
News to know
Rent concessions are on the rise in America’s Sunbelt cities | Wall Street Journal, January 12, 2026
Rent concessions are rising across several Sunbelt apartment markets as a surge of pandemic era construction runs ahead of renter demand, with Phoenix leading the country. About 54 percent of Phoenix rentals are offering at least one month of free rent, according to Apartment List, reflecting an oversupply of newly delivered luxury units built to attract remote workers. Similar conditions are evident in markets like Denver and Charlotte, while coastal cities such as New York and Los Angeles remain undersupplied and highly competitive. Owners are using concessions to protect headline rents rather than cut asking prices, though effective rents in Phoenix still fell about 4 percent year over year in 2025, with discounts concentrated in new, amenity rich buildings. Developers have since pulled back on new starts, expecting the excess supply to be absorbed over the next year to 18 months, which could eventually restore pricing power.
IRS crackdown on real estate funds, private equity stalls | GlobeSt, January 12, 2026
A federal effort to ramp up audits of large real estate, private equity, and venture capital partnerships is losing momentum, raising questions about future tax enforcement across the investment industry. Two years after the Internal Revenue Service launched a major initiative to scrutinize complex partnership structures, staffing losses and leadership turnover have sharply reduced audit activity, with the pace reportedly down 80 to 90 percent, according to tax attorneys. The program was designed to target aggressive tax strategies that the Treasury estimates cost more than $100 billion over the past decade, but cost cutting measures and layoffs under the current administration have disproportionately hit the specialized audit teams. While critics argued the initiative was overly burdensome, academic research shows partnership audits are highly effective, generating roughly $20 in tax revenue for every $1 spent. The slowdown suggests large real estate funds and other investment partnerships may face less near term audit pressure, even as partnership profits have grown far faster than those of traditional corporations.
New York Governor Kathy Hochul has proposed sweeping changes to the state’s environmental review law to speed up housing development and lower construction costs. The plan would exempt most housing projects from review under the State Environmental Quality Review Act, a process that can add roughly two years and hundreds of thousands of dollars to projects, while capping reviews at two years for developments that still qualify. The proposal targets housing on previously disturbed land outside protected or flood prone areas and is part of Hochul’s broader “Let Them Build” agenda as housing affordability becomes a central political issue. Similar moves have already been taken in California under Governor Gavin Newsom. Supporters argue the reforms could unlock stalled supply in a state estimated to be short roughly 800,000 homes, while environmental groups are expected to push back as lawmakers debate the proposal as part of the upcoming state budget.
Outstanding US CRE mortgage debt nears $5T | ConnectCRE, January 15, 2026
Outstanding U.S. commercial and multifamily mortgage debt continued to climb in late 2025, reaching $4.93 trillion at the end of the third quarter, up 1.1 percent or $53.4 billion from the prior quarter, according to the Mortgage Bankers Association. Growth was driven primarily by multifamily lending, with multifamily debt rising $40.3 billion, or 1.8 percent, to $2.24 trillion. Banks remain the largest holders of CRE and multifamily mortgage debt at roughly $1.8 trillion, followed by agency and GSE portfolios and MBS at $1.11 trillion, life insurance companies at $783 billion, and CMBS, CDO, and other ABS at $642 billion. The MBA noted that despite ongoing economic and market uncertainty, agency lending led the market, with banks and insurers also posting solid gains.
Saks Global bankruptcy raises questions for CRE | Commercial Property Executive, January 15, 2026
Saks Global Holdings LLC has filed for Chapter 11 bankruptcy after missing a $100 million debt payment and securing roughly $1.8 billion in debtor in possession financing to keep stores and e-commerce operations running, raising new questions about the future of its retail footprint and leased real estate. The luxury conglomerate, formed in a $2.7 billion deal that combined Saks Fifth Avenue, Neiman Marcus, and Bergdorf Goodman and backed by investors including Amazon and Authentic Brands, operates about 70 full line luxury stores and controls roughly 8.4 million square feet of U.S. retail real estate. As part of the restructuring, the company is evaluating its store portfolio, with potential closures of underperforming or overlapping locations, particularly where Saks and Neiman Marcus co anchor the same malls such as those owned by Simon Property Group. Analysts also expect asset sales and possible sale leaseback transactions to generate liquidity, putting a spotlight on high value properties like the Saks Fifth Avenue flagship at 611 Fifth Avenue in Manhattan, which is owned by Vornado Realty Trust.
Global real estate investor confidence has risen to its highest level since 2019 heading into 2026, according to the Investment Intentions Survey from INREV, ANREV, and PREA, signaling that investors increasingly believe markets have moved past the worst of the downturn. About 38 percent of investors expect to increase real estate allocations over the next two years, while global allocations now sit just below target levels, leaving room for new capital deployment. Europe continues to dominate destination preferences, accounting for seven of the top ten markets, with the UK and Germany leading and Spain and Denmark gaining ground, while France has slipped due to political and economic concerns. Residential remains the top sector globally and in Europe, followed by industrial and logistics, while interest in offices has improved but remains highly selective and focused on prime assets. Investors are approaching the next phase of the cycle with greater discipline, favoring debt funds, joint ventures, and active asset management, while sustainability and impact investing continue to shape strategies, particularly outside North America.
INSIGHTS Spotlight
Catch the latest research and insights from Altus
Podcast | Data and policy shaping the early 2026 CRE market
What happens when a cooling labor market, easing financing conditions, and renewed activity on housing policy all converge at once? This week on CRE Exchange, Omar Eltorai and Cole Perry discuss how these forces are shaping the early narrative for the 2026 commercial real estate market.
Important dates
Upcoming data releases and events
Data releases (Times in EST)
Wednesday, January 21
10:00AM: Construction Spending
10:00AM: Pending Home Sales
Thursday, January 22
8:30AM: Q3 2025 GDP (First Revision)
Friday, January 23
9:45AM: S&P Flash U.S. Services PMI
9:45AM: S&P Flash U.S. Manufacturing PMI
10:00AM: University of Michigan Consumer Sentiment Index
Upcoming industry events
January 25 – January 28: BOMA National Issues Conference (Washington, DC)
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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