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Category: News
NEWS: Commercial Real Estate Sentiment Steady in Q1 2026 as Debt Availability Improves
(WASHINGTON, D.C.) — The Real Estate Roundtable (RER) today released its First Quarter 2026 Sentiment Index, a quarterly measure of confidence among senior commercial real estate (CRE) executives. The overall index registered 66, down one point from Q4 2025, as respondents described a market in the early stages of a tentative, uneven recovery. Tariffs and interest-rate uncertainty continue to widen buyer-seller spreads and slow price discovery.
The Current Index rose two points to 66, while the Future Index decreased two points to 67, reflecting cautious optimism for improved conditions in 2026 despite ongoing volatility.
“This quarter’s survey shows the market is stabilizing, with improving debt availability and growing optimism about the year ahead—even as uncertainty continues to keep transaction volume below potential,” said Jeffrey DeBoer, RER President and CEO.
“The industry is positioned for a more constructive 2026, but sustained momentum will depend on a stable policy environment,” DeBoer added. “That stability supports investment decisions that drive jobs, housing, and economic activity in communities nationwide.”
The Q1 Sentiment Index topline findings include:
- The Q1 2026 Real Estate Roundtable Sentiment Index registered an overall score of 66, a decrease of one point from the previous quarter. The Current Index registered 66, a two-point increase over Q4 2025. The Future Index posted a score of 67 points, a decrease of two points from the previous quarter, reflecting a prevailing sentiment that the market is in the early stages of a tentative, uneven recovery. Political, tariff, and interest rate uncertainty is contributing to wide spreads between buyers and sellers. Amid the uncertainty around pricing clarity and geopolitical stability, participants are cautiously optimistic for an improved 2026.
- Although perspectives vary by asset class, overall market sentiment trends positive. Less than 10% of respondents believe that general market conditions are worse than this time last year, and 63% of respondents believe that general market conditions are better than this time last year. Furthermore, 64% of participants expect general market conditions to show improvement one year from now. Leaders reported strength in data centers and industrial, while returns in the multifamily and office sectors remain heavily location-dependent.
- Forty-three percent (43%) of respondents believe asset values are roughly unchanged compared to a year ago. Nearly half of participants are seeing green shoots, as 48% believe asset prices have increased while only 9% believe they have declined. Looking ahead, the outlook is optimistic: 67% expect asset prices to rise over the next year, 30% believe asset values will remain stable, and only 3% anticipate a slight decline.
- Perceptions on the availability of equity capital are muted relative to last quarter, although about four in ten respondents (42%) still believe equity availability is better compared to a year ago. On the other hand, sentiment around debt capital has risen significantly, as 78% said the availability of debt capital has improved from last year. Looking forward, 65% of respondents believe that equity capital availability will be better in one year, and 49% believe debt capital availability will be better.
Sample responses from participants in the Sentiment Index’s Q1 survey include:
“The market is stagnant but promising; there’s a lot of pent-up demand and capital that needs to be deployed. Banks that were previously on the sidelines are looking to replenish balance sheets.”
“The real estate sector is in the early stages of a new cycle: Debt and equity are open, people have accepted the higher-for-longer interest rate environment, and now the focus is on relative value and income across all asset classes.”
“The real estate market is largely still locked up. People need certainty; when certainty returns, transaction volume will skyrocket.”
Data for the Q1 survey was gathered by Chicago-based Ferguson Partners on RER’s behalf in January. See the full Q1 report.
The Real Estate Roundtable (RER) brings together leaders of the nation’s top publicly-held and privately-owned real estate ownership, development, lending and management firms with the leaders of major national real estate trade associations to jointly address key national policy issues relating to real estate and the overall economy.
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The Roundtable’s policy news digest will resume publication on Friday, January 9, 2026.
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Roundtable Weekly Will Resume Publication on December 5, 2025
The Roundtable’s policy news digest will resume publication on Friday, December 5, 2025
Recent issues of Roundtable Weekly can be searched by keyword here.
DeBoer Spotlights CRE Priorities, Calls for Unity at Connect Apartments 2025
At Connect Apartments 2025 in Los Angeles this week, Real Estate Roundtable (RER) President and CEO Jeffrey DeBoer delivered the keynote Q&A session, outlining top legislative and regulatory priorities in the coming months.
Remarks
- His remarks covered implementation of new tax rules on bonus depreciation and expensing, expansion of the Low-Income Housing Tax Credit, policies to encourage new housing supply, efforts to enhance energy grid access, and preparation for the scheduled 2027 expiration of the Terrorism Risk Insurance Act (TRIA).
- Recognizing that his remarks came on Sept. 11, DeBoer emphasized the broader role of industry leaders in fostering collective action.
- “For the past 24 years, our industry and its leaders have supported individual, business, and policy actions to respond to and prevent terrorism. Today we face a new reality that also requires a collective response,” he said.
- He continued, “Our personal, social, and political discourse clearly has spiraled in a very dangerous direction. Many are now calling on political leaders to tone down their divisive rhetoric. We agree. But we also strongly believe that political leaders should not act alone. The Real Estate Roundtable, and our leaders, now urge that the millions of people in our industry work to find boundaries to inciteful rhetoric by rejecting actions and language that vilify and denigrate those whose views differ from our own.”
Next Wednesday, the House Financial Services Housing and Insurance Subcommittee will hold a hearing on “The Reauthorization of the Terrorism Risk Insurance Act of 2002.” RER will continue to engage on TRIA renewal and related policy issues.
Roundtable Weekly Will Resume Publication on September 5, 2025
The Roundtable’s policy news digest will resume publication on Friday, September 5, 2025
Recent issues of Roundtable Weekly can be searched by keyword here.
Roundtable Statement on the Reorganization of the ENERGY STAR Program
Statement by Real Estate Roundtable President and CEO Jeffrey D. DeBoer
(WASHINGTON, D.C.) — In response to reports regarding the federal government’s budget and reorganization of the ENERGY STAR program, Jeffrey D. DeBoer, President and CEO of The Real Estate Roundtable, stated:
“The highly successful ENERGY STAR program is an integral, voluntary participation program critical to residential and commercial, private and public sector U.S. buildings. The program drives efficiency, helps create greater capacity on energy grids to boost economic growth, and enhances profitability for owners and investors in U.S. real estate.
“ENERGY STAR software is embedded in the fabric of how profitable, energy efficient buildings are run and managed in all markets across the nation. ENERGY STAR provides the key tools for families, businesses, and owners of schools, hospitals, government, and many other types of buildings to save money on their utility bills with no heavy-handed federal mandates. Owners and developers rely on ENERGY STAR to attract equity and debt capital so U.S. building infrastructure can compete with the best real estate assets in the world. ENERGY STAR also provides the best measure to reduce energy use so buildings put less strain on the grid—to free up the electricity we need to lead the world in artificial intelligence, support innovations in the crypto asset industry, and bring back manufacturing to America.
“Only the federal government has the data, talent, lab research, and other expertise necessary to run all facets of ENERGY STAR efficiently and impartially,” DeBoer continued. “Over the course of 35 years, Congress has authorized ENERGY STAR through bipartisan legislation on multiple occasions. The Real Estate Roundtable looks forward to collaborating with the Trump Administration, Congress, the Environmental Protection Agency, the Department of Energy, and our allies in the product manufacturing sector to transition the landmark ENERGY STAR public-private partnership as it evolves to support a new generation of cutting edge buildings, plants, and consumer products.”
About The Real Estate Roundtable
The Real Estate Roundtable brings together leaders of the nation’s top publicly-held and privately-owned real estate ownership, development, lending, and management firms with leaders of major national real estate trade organizations to jointly address key national policy issues relating to real estate and its important role in the global economy.
The collective value of assets held by Roundtable members exceeds $4 trillion. The Roundtable’s membership represents more than 3 million people working in real estate; 12 billion square feet of office, retail, and industrial space; over 4 million apartments; and more than 5 million hotel rooms. It also includes the owners, managers, developers, and financiers of senior, student, and manufactured housing—as well as medical offices, life science campuses, data centers, cell towers, and self-storage properties.
The Roundtable’s policy news and more are available on The Roundtable website.
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RER Members: Call to Action—Oppose Proposals Limiting Deduction of State and Local Business Property Taxes
The Real Estate Roundtable (RER) and sixteen other national real estate organizations recently wrote to Congress urging them to oppose any proposal that would cap or eliminate the deductibility of state and local business property taxes. (Letter)
A cap on property tax deductibility could have devastating consequences for commercial real estate owners, developers, and investors nationwide.
Call to Action
The Real Estate Roundtable urges members to amplify this message to their representatives in Congress.
Click here to find your Representative. Click here to find your Senators.
Effects on CRE and the Broader Economy
- Some lawmakers have raised “Business SALT” and potential restrictions on the deductibility of state and local property and income taxes as a possible revenue offset for the tax bill.
- The ripple effects of this proposal would extend far beyond property owners to impact the broader economy and housing affordability nationwide.
- U.S. commercial real estate is valued at $18-$22 trillion, supporting 15 million jobs and generating $2.3 trillion in GDP annually.
- Eliminating the business deduction for property taxes would be the equivalent of raising business owners’ property tax bills by roughly 40 percent, causing employers to owe federal tax on money that they do not have.
- This tax change could reverse the benefits of the 2017 Tax Cuts and Jobs Act (TCJA) and Section 199A, potentially raising effective tax rates to 1970s-era levels near 50%.
- Additionally, the increased tax burdens could discourage new investment, deter housing development, and exacerbate the national housing crisis.
- Given that U.S. businesses paid $1.1 trillion in state and local business-related taxes in 2023 (including nearly $400 billion in property taxes), the stakes are extremely high.
Roundtable Weekly Will Resume Publication on January 10, 2025
The Roundtable’s policy news digest will resume publication on Friday, January 10, 2025
Recent issues of Roundtable Weekly can be searched by keyword here.
Sentiment Index Reaches Three Year High, Signaling Industry Optimism for Gradual Recovery
The Real Estate Roundtable’s Q4 2024 Sentiment Index reached an overall score of 73, up 9 points from the previous quarter and marking its highest score since Q4 2021. The three year high reflects industry leaders’ cautious optimism that commercial real estate markets are stabilizing, showing signs of recovery and becoming well positioned for activity in 2025.
The Index, which measures commercial real estate executives’ confidence and expectations about the industry environment, is scored on a scale of 1 to 100 by averaging the scores of Current and Future Economic Sentiment Indices. Any score over 50 is viewed as positive.
Roundtable Perspective
- Roundtable President and CEO Jeffrey DeBoer said, “The notable increase in sentiment this quarter reflects a combination of factors, primarily the Federal Reserve’s rate cuts and expected future monetary easing. This action coupled with positive shifts in office leasing demand and a broader return-to-office trend are leading to greater price discovery and transaction volume. Housing supply constraints, access to energy sources, high operating expenses continue to present major challenges.”
- Compared to one year ago, sentiment on current conditions is up by 37 points, perception of future conditions is up by 20 points, and overall conditions are up by 29 points.
- In comparison to last quarter, sentiment on current conditions is up by 10 points, perception of future conditions is up by 7 points, and overall conditions are up by 9 points.
- Roundtable Chair Kathleen McCarthy (Global Co-Head of Blackstone Real Estate, Blackstone) commented on the Q4 Sentiment Index results: “The improved sentiment reflects the continuing recovery in commercial real estate, which is supported by improving liquidity in the market. This recovery will play out over time, and it is critical that we continue to support policies that help drive economic growth in communities throughout the U.S.”
Topline Findings
- All indices of The Roundtable’s Q4 Index are up, compared to the previous quarter and one year ago.
- The Q4 2024 Real Estate Roundtable Sentiment Index reached an overall score of 73, up 9 points from the previous quarter and marking the highest score since Q4 2021. The Current Index registered 69, rising 10 points from Q3 2024. Meanwhile, the Future Index hit 77, an increase of 7 points from the previous quarter and the highest level seen since 2011.
- Leaders in the industry are cautiously optimistic that the commercial real estate industry is showing signs of recovery and is well positioned for activity in 2025. Over three-quarters (77%) of Q4 survey participants said conditions are better now compared to this time last year, and 88% of respondents expect general market conditions to improve one year from now.
- Although there is some concern that multifamily assets will plateau in certain geographic areas, the market is optimistic about industrial development, Class A offices, shopping centers, and data centers. A significant 98% of Q4 survey participants expressed optimism that asset values will be higher (79%) or the same (19%) one year from now, indicating some semblance of expected stability. 71% of Q4 survey participants believe asset values are higher (38%) or about the same (33%) today compared to a year ago.
- 61% and 66% of respondents believe the availability of equity and debt capital, respectively, has improved compared to one year ago. There is even more optimism for the future, with 80% and 79% of participants believing the availability of equity and debt capital, respectively, will be better one year from now. While commentary indicates that the capital markets are starting to open, the cost of capital remains elevated from previous levels.
Data for the Q4 survey was gathered by Chicago-based Ferguson Partners on The Roundtable’s behalf in October. See the full Q4 report.