Category: Quarterly Sentiment Index

Stabilizing Market Conditions Drive Optimism in Q3 Sentiment Index

Posted on by abigail_grenadier

The Real Estate Roundtable’s Q3 2025 Sentiment Index shows increased confidence among industry executives as market conditions stabilize and sector-led growth emerges. The overall Index registered a score of 67—up 13 points from Q2—with notable increases in both the Current (63) and Future (71) indices. (Full Report)

Roundtable View

  • RER President and CEO Jeffrey DeBoer said, “Our Q3 Sentiment Index results show that market conditions have continued to stabilize in a meaningful way, supported by improved supply and demand. Commercial real estate executives are increasingly optimistic that the next 12 months will bring continued improvement. That said, certain property types continue to face headwinds, and capital access remains uneven across markets and sectors. Even so, the prevailing sentiment is that stability is returning and opportunities are emerging.” (Press Release, Aug. 14)
  • DeBoer added, “The provisions in the One Big Beautiful Bill Act should help accelerate this momentum—expanding housing supply, revitalizing communities, spurring job-creating investment nationwide, and strengthening the broader economy. Coupled with improving debt capital availability and stabilizing asset values, these policies set the stage for renewed growth. Moving forward, industry leaders and policymakers must continue to work together to promote investment, ensure credit access, and address persistent supply-demand imbalances in housing and other high-need property sectors.” (ConnectCRE, Aug. 14)

Topline Findings

The Q3 Sentiment Index topline findings include:

  • The Q3 2025 Sentiment Index registered an overall score of 67, an increase of 13 points over the previous quarter. The Current Index registered a score of 63, a 13-point increase over Q2 2025. The Future Index posted a score of 71 points, an increase of 13 points over the previous quarter, reflecting sentiment that operating conditions have largely stabilized. Occupancy and demand are holding, and values appear to have bottomed. Participants expect modest, sector-led growth, yet acknowledge lingering headwinds for weaker property types.
  • Sentiment around general market conditions has markedly increased since last quarter (Q2). Only 10% of respondents believe that general market conditions are worse than this time last year, and 56% of respondents believe that general market conditions are better than this time last year. Almost three-quarters (73%) of Q3 survey participants expect general market conditions to show improvement one year from now. Multifamily, data centers, and NYC office shine while industrial supply is overbuilt.
  • Half of respondents believe asset values are roughly unchanged compared to a year ago. The remaining respondents are divided, with 32% believing asset prices have increased and 18% believing they have declined. Looking ahead, the outlook is optimistic: 59% expect asset prices to rise over the next year, 32% believe asset values will remain stable, and only 9% anticipate a slight decline.
  • Perceptions on the availability of equity capital relative to last year are muted, with 50% of respondents believing equity availability is unchanged compared to a year ago. On the other hand, sentiment around debt capital has risen significantly, as 65% said the availability of debt capital has improved from last year. Looking forward, 55% of respondents believe that equity capital availability will be better in one year, and 48% believe debt capital availability will be better.

Market Dynamics

  • Survey participants emphasized the sector-specific nature of today’s market, with performance tied closely to location, asset quality, and loan maturity schedules. Sample responses noted that conditions feel “far steadier than we have seen in recent years,” while others highlighted that “quality product will still get funded” despite a “haves and have-nots” equity environment. (ConnectCRE, Sept. 2)
  • The Federal Reserve’s Beige Book released this week, noted that while overall economic momentum remains muted, commercial real estate showed resilience, especially in data center construction.
  • Districts such as Philadelphia, Cleveland, and Chicago reported a surge in development, fueled by the push to deploy AI and select infrastructure projects. The Fed described this trend as a rare bright spot for CRE in an otherwise cautious market, while conditions in other property sectors varied widely. (GlobeSt. Sept. 4)
  • The commercial real estate industry continues to face persistent challenges from a shortage of skilled labor and rising construction costs, underscoring the urgent need for workforce development and training initiatives.
  • Labor Secretary Lori Chavez-DeRemer, joined Punchbowl News Thursday to discuss workforce innovation, calling for more apprenticeship and training programs to address the growing construction labor shortage. (Punchbowl News, Sept. 5)

RER’s Q3 survey was conducted in July by Chicago-based Ferguson Partners. Read the full Q3 report.

CRE Executives Signal Increased Caution in Q2 Sentiment Survey

Posted on by abigail_grenadier

Commercial real estate executives report a decline in market confidence this quarter, as policy uncertainty, rising costs, and investor caution cloud the outlook, according to The Real Estate Roundtable’s Q2 2025 Sentiment Index released today.

Roundtable View

  • The quarterly Sentiment Index, measuring executive perceptions of market conditions, asset values, and capital availability, declined to an overall score of 54, down 14 points from last quarter. The Current Conditions Index dropped to 50, reflecting a 15-point decline, while the Future Conditions Index decreased by 12 points, settling at 58.
  • The Overall Index is scored on a scale of 1 to 100 by averaging Current and Future Indices; any score over 50 is viewed as positive.
  • RER President and CEO Jeffrey DeBoer said, “While respondents note early signs of market stabilization and improved transactional discipline, lingering concerns over U.S. trade policies and other economic headwinds are tempering optimism for the remainder of 2025. The office sector remains under pressure, but is experiencing a gradual rebound as return-to-office trends continue to shift closer to pre-pandemic patterns.”
  • He added, “Uncertain tariff policies are driving up construction costs and weighing on long-term investment decisions. At the same time, the Federal Reserve’s decision to hold interest rates steady is slowing capital formation and delaying needed transactions. We need pro-growth economic policies that encourage productive investment, strengthen communities, and promote long-term stability. Extending and making the 2017 Tax Cuts and Jobs Act (TCJA) provisions permanent, along with advancing incentives to address our nation’s housing supply shortage, are crucial to help achieve these goals.”
  • In the May edition of ULI’s Economist Snapshot, RER’s Senior Vice President Clifton E. “Chip” Rodgers Jr. weighed in on how rising tariffs and trade uncertainty are impacting commercial real estate—from delayed development timelines to rising construction costs and reduced foreign investment. (ULI, May 13)

Topline Findings

  • The Q2 2025 Real Estate Roundtable Sentiment Index registered an overall score of 54, a decrease of 14 points from the previous quarter. The Current Index registered at 50, a 15-point decrease compared to Q1 2025. The Future Index posted a score of 58 points, a decrease of 12 points from the previous quarter, reflecting uncertainty around policy direction, rising costs, and execution risk. While market sentiment remains cautious, respondents are seeing early signs of stabilization and improved transactional discipline. Nevertheless, expectations for improvement have softened compared to last year, and many investors are still hesitant to re-engage.
  • Market conditions remain mixed, with general uncertainty, along with sector and geographic bifurcation, driving sentiment. 37% of respondents believe that general market conditions are worse now compared to the same period last year, and 37% of respondents believe that general market conditions are better than this time last year.
  • Close to half (47%) of Q2 survey participants expect general market conditions to show improvement one year from now, while 20% of Q2 participants expect general market conditions to be somewhat worse in a year.
  • Logistics and high-quality multifamily remain bright spots, while hospitality and office—particularly commodity space—continue to face significant challenges. From a geographic standpoint, the Midwest is showing relative resilience, whereas sentiment around the Sunbelt reflects concern over elevated supply and near-term softened demand.
  • 42% of respondents believe asset values are roughly unchanged compared to a year ago. The remaining respondents are divided, with 22% believing asset prices have increased and 36% believing they have declined. Looking ahead, the outlook is cautious: 38% expect asset prices to remain stable over the next year, while another 38% anticipate a slight decline.
  • Perceptions of equity capital are widely varied, though 34% of respondents believe the availability of equity capital is better than it was a year ago. Sentiment around debt capital has brightened, as 43% said the availability of debt capital has improved from last year. Looking forward, 45% of respondents believe that equity capital availability will be better in one year and 39% believe debt capital availability will be better in one year.

Data for the Q2 survey was gathered by Chicago-based Ferguson Partners on RER’s behalf. Read the full Q2 report here.

Commercial Real Estate Executives Signal Increased Caution in Q2 Sentiment Survey

Posted on by abigail_grenadier

(WASHINGTON, D.C.) — The Real Estate Roundtable (RER) today released its Q2 2025 Sentiment Index, reporting a decrease in confidence in the commercial real estate market environment among industry executives due to policy uncertainty, rising costs, and cautious investor sentiment. The quarterly Sentiment Index, measuring executive perceptions on market conditions, asset values, and capital availability, declined to an overall score of 54, down 14 points from last quarter. The Current Conditions Index dropped to 50, reflecting a 15-point decline, while the Future Conditions Index decreased by 12 points, settling at 58. The Overall Index is scored on a scale of 1 to 100 by averaging Current and Future Indices; any score over 50 is viewed as positive.

RER President and CEO Jeffrey DeBoer said, “While respondents note early signs of market stabilization and improved transactional discipline, lingering concerns over U.S. trade policies and other economic headwinds are tempering optimism for the remainder of 2025. The office sector remains under pressure, but is experiencing a gradual rebound as return-to-office trends continue to shift closer to pre-pandemic patterns.”

He added, “Uncertain tariff policies are driving up construction costs and weighing on long-term investment decisions. At the same time, the Federal Reserve’s decision to hold interest rates steady is slowing capital formation and delaying needed transactions. We need pro-growth economic policies that encourage productive investment, strengthen communities, and promote long-term stability. Extending and making the2017 Tax Cuts and Jobs Act (TCJA) provisions permanent, along with advancing incentives to address our nation’s housing supply shortage, are crucial to help achieve these goals.”

The Q2 Sentiment Index topline findings include:

  • The Q2 2025 Real Estate Roundtable Sentiment Index registered an overall score of 54, a decrease of 14 points from the previous quarter. The Current Index registered at 50, a 15-point decrease compared to Q1 2025. The Future Index posted a score of 58 points, a decrease of 12 points from the previous quarter, reflecting uncertainty around policy direction, rising costs, and execution risk. While market sentiment remains cautious, respondents are seeing early signs of stabilization and improved transactional discipline. Nevertheless, expectations for improvement have softened compared to last year, and many investors remain hesitant to re-engage.
  • Market conditions remain mixed, with general uncertainty, along with sector and geographic bifurcation, driving sentiment. 37% of respondents believe that general market conditions are worse than this time last year, and 37% of respondents believe that general market conditions are better than this time last year. Close to half (47%) of Q2 survey participants expect general market conditions to show improvement one year from now, while 20% of Q2 participants expect general market conditions to be somewhat worse in a year. Logistics and high-quality multifamily remain bright spots, while hospitality and office—particularly commodity space—continue to face significant challenges. From a geographic standpoint, the Midwest is showing relative resilience, whereas sentiment around the Sunbelt reflects concern over elevated supply and near-term softened demand.
  • 42% of respondents believe asset values are roughly unchanged compared to a year ago. The remaining respondents are divided, with 22% believing asset prices have increased and 36% believing they have declined. Looking ahead, the outlook is cautious: 38% expect asset prices to remain stable over the next year, while another 38% anticipate a slight decline.
  • Perceptions of equity capital are widely varied, though 34% of respondents believe the availability of equity capital is better than it was a year ago. Sentiment around debt capital has brightened, as 43% said the availability of debt capital has improved from last year. Looking forward, 45% of respondents believe that equity capital availability will be better in one year and 39% believe debt capital availability will be better in one year.

Some sample responses from participants in the Sentiment Index’s Q2 survey include:

“The one thing that every investor – domestic and foreign – wants is stability. The environment in the United States is incredibly unstable, so some of our investors are sitting on the sidelines.”

“Foreign capital flows into the U.S. will shrink in the near term. That said, the U.S. is typically the first market to readjust in terms of pricing, and that will create opportunity.”

“We’re starting to see slightly more trades, which opens up the door to better visibility into valuations, and as a result, may improve the comfort and volume of future trades.”

Data for the Q2 survey was gathered by Chicago-based Ferguson Partners on RER’s behalf in April. See the full Q2 report.

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 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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Sentiment Index Reflects Market Stabilization Amidst Changing Economic Landscape

Posted on by Trey Jackson

The Real Estate Roundtable’s Q1 2025 Sentiment Index, which measures commercial real estate executives’ confidence and expectations about the industry environment, suggests a cautious optimism, fading expectations for additional interest rate cuts, rising insurance costs and larger policy shifts. 

Roundtable View

  • The Q1 Index reported an overall score of 68, reflecting a 5-point decline from the previous quarter, and the Future Index posted a score of 70 points—a decrease of 7 points from the previous quarter—indicating that optimism for the impact of potential rate cuts has subsided.

  • Roundtable President and CEO Jeffrey DeBoer said, “The commercial real estate industry remains in a transitional period. Although interest rate adjustments have provided some relief, the reality is that capital markets remain constrained, and investors are being more selective. While there are signs of market stability, there is lingering uncertainty over tariffs, expiring tax cuts, and regulatory reforms that could slow investment and economic growth.”

  • He added, “There must be a supportive public policy environment that understands and addresses the multifaceted challenges the industry faces. The Roundtable remains committed to working with policymakers and the administration to advocate and demonstrate the importance of maintaining policies that encourage capital formation, reward entrepreneurial risk-taking, and support jobs and communities.”

Topline Findings

  •  The Q1 2025 Real Estate Roundtable Sentiment Index registered an overall score of 68, a decrease of 5 points from the previous quarter. The Current Index registered 65, a 4-point decrease compared to Q4 2024. The Future Index posted a score of 70 points, a decrease of 7 points from the previous quarter, indicating optimism for the impact of potential rate cuts has subsided. 

  • Nevertheless, survey participants are cautiously optimistic that transaction activity and capital deployment will continue to normalize in 2025. Interest rates, insurance costs and the implications of the Trump administration are top of mind for many investors.

  • Evolving market trends continue to shape the real estate landscape. A majority (70%) of Q1 survey participants expect general market conditions to show improvement one year from now. Additionally, 61% of respondents said conditions are better now compared to this time last year. Only 2% of Q1 participants expect general market conditions to be somewhat worse in a year. A substantial volume of industrial and multifamily assets came online in 2024, though activity is expected to slow in 2025. Return-to-office mandates thus far are not moving the needle on office assets, of which class B and C continue to struggle.

  • A plurality of participants (45%) believe asset values have not meaningfully changed from where they were a year ago. However, respondents are overall optimistic, with most (56%) predicting that asset values will be higher one year from now. 

  • The real estate capital markets have seen steady improvement. 47% of respondents believe the availability of equity capital is better than it was a year ago, while 62% said the availability of debt capital has improved from last year. Looking forward, virtually all respondents believe that capital availability will be the same or better in one year (99% and 98% for equity and debt capital, respectively).

Data for the Q1 survey was gathered by Chicago-based Ferguson Partners on The Roundtable’s behalf. Read the full Q1 report. 

Sentiment Index Reflects Growing Optimism Amid Persistent Market Challenges

Posted on by Trey Jackson

The Real Estate Roundtable’s Q3 2024 Sentiment Index, which measures commercial real estate executives’ confidence and expectations about the industry environment, suggests a growing confidence in the future of the commercial real estate market despite ongoing challenges.

Roundtable View

  • The Q3 Sentiment Index reported an overall score of 64, reflecting an increase of three points from the previous quarter, and the Future Index at 70, up four points from the previous quarter.
  • Roundtable President and CEO Jeffrey DeBoer said, “The increase in our Q3 Sentiment Index indicates that while uncertainty remains, the industry is gradually regaining confidence. Leaders are seeing signs of stabilization in asset values and a potential improvement in the availability of capital, which are encouraging signals as we navigate this complex environment.”
  • This rise in sentiment marks an 18-point increase in the overall score since last year.
  • He added, “The results of the report reflect the resilience of the commercial real estate industry. The fact that a majority of executives expect better conditions in the coming year is a strong signal that although serious challenges remain, the worst may be behind us.”

Topline Findings

  • All indices of The Roundtable’s Q3 Index are up, compared to the previous quarter and one year ago. The Index 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.
  • The Q3 2024 index registered an overall score of 64, an increase of three points over the previous quarter. The Current Index registered 59, a four-point increase over Q2 2024. The Future Index posted a score of 70 points, an increase of four points from the previous quarter, indicating that uncertainty surrounding the future of asset values and availability of capital persists, but has lessened.
  • In Q3 2023, the Overall Index registered at 46, while the Current Index registered at 33, reflecting a notable 26-point gain in the Q3 2024 Current Index compared to the previous year.
  • Evolving market trends continue to shape the real estate landscape. A majority (70%) of Q3 survey participants expect general market conditions to show improvement one year from now. Additionally, 48% of respondents said conditions are better now compared to this time last year. Only 6% of Q3 participants expect general market conditions to be somewhat worse in a year, a decrease from 11% in Q2.
  • Some subsector asset classes, such as data centers and student housing, are well-positioned from both a fundamentals and capital availability perspective. However, Class B office properties continue to face ongoing challenges, and the fast pace of multifamily and industrial rent growth has subsided.
  • A significant 88% of Q3 survey participants expressed optimism that asset values will be higher (57%) or the same (31%) one year from now, indicating some semblance of expected stability. 76% of Q3 survey participants believe asset values are slightly lower (50%) or about the same (26%) today compared to a year ago.
  • The real estate capital markets landscape remains challenging. However, 71% of respondents believe the availability of equity capital will improve in one year, while 60% said the availability of debt capital will improve in one year. 40% of participants said the availability of debt capital would be the same or worse in one year, an increase from 36% who voiced the same expectation in Q2 of this year.

Data for the Q3 survey was gathered by Chicago-based Ferguson Partners on The Roundtable’s behalf in July. Read the full Q3 report.

Despite Ongoing Market Challenges, Industry Leaders Expect Improvements in 2024

Posted on by Trey Jackson
Real Estate Roundtable President and CEO Jeffrey DeBoer
Real Estate Roundtable President and CEO Jeffrey DeBoer

The Real Estate Roundtable’s Q1 2024 Sentiment Index confirms that commercial real estate property markets continue to experience significant challenges. At the same time, in the coming year industry executives expect monetary policy action reflecting lower inflation to bring greater stability in asset pricing and expanded availability of debt and equity capital. 

Cautious Optimism

  • Roundtable President and CEO Jeffrey DeBoer said, “Our current Sentiment Index shows improved optimism by industry leaders, compared with previous surveys that highlighted significant market concerns. The Q1 sentiment continues to note challenges presented by ongoing tight capital markets, increased operating expenses, and the continuing uncertainty of post-pandemic, in-office work. However, as the interest rate environment appears to have settled somewhat, executives are now expressing increased optimism that values and capital availability will improve in 2024.”

  • He added, “As we look at the current and future landscape of commercial real estate, it’s clear that we are at a pivotal moment. With nearly $3 trillion of commercial real estate loans maturing in the next four years, it remains very crucial that lenders continue to work constructively with borrowers to reflect both current and expected economic growth. Markets and asset values continue to adjust and stabilize as office use, interest rates, and inflation begin to normalize.”

  • All indices of The Roundtable’s Q1 Index are up, compared to the previous quarter and one year ago. The Index—a measure of senior executives’ confidence and expectations about the commercial real estate market 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. ­­­­

Topline Findings

The Real Estate Roundtable's Q1 2024 Sentiment Index
  • The Q1 2024 Real Estate Roundtable Sentiment Index registered an overall score of 61, an increase of 17 points from the previous quarter. The Current Index registered 53, a 21-point increase over Q4 2023, and the Future Index posted a score of 70 points, an increase of 13 points from the previous quarter. These increases point to cautious optimism in the real estate market.
  • There continue to be variations among asset classes and within specific property types as the real estate market rapidly changes. Industrial and multifamily are starting to soften, but retail and hospitality asset classes were identified as being surprisingly resilient. While many office properties have experienced a significant erosion in value, Class A offices continue to outperform.
  • An overwhelming 79% of survey participants indicate that asset values have decreased compared to the previous year. However, the potential end to interest rate hikes has instilled some industry optimism, with nearly 80% of survey participants expecting asset values to be the same or higher a year from now.
  • Survey participants continue to emphasize the challenging capital markets landscape, with 86% and 85% of survey participants suggesting that the availability of equity and debt capital, respectively, is the same or worse than a year ago. That said, 67% and 76% believe the availability of equity and debt capital, respectively, will improve a year from now. 

Data for the Q1 survey was gathered in January. See the full Q1 report.

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