Source: Economics Group of Wells Fargo Bank, N.A.
Summary
CRE on Stable Ground Before Liberation Day
The CRE (Commercial Real Estate) market started 2025 on a positive note. During Q1-2025, transaction volumes rose solidly against a backdrop of slightly lower interest rates and improved capital availability. CRE sales activity remains fairly tepid from a historical perspective, however, transactions have steadily improved over the past year. Further stability in property valuations was another green shoot. Property prices are now generally lower compared to the peak levels registered in 2021, but have stopped declining and are now showing modest growth. All told, the general firming in property prices and rise in transactions were encouraging signs that the momentum observed in 2024 was not just a flash in the pan.