Most store types report encouraging start to 2024. Consumers set a new benchmark for quarterly retail sales volume in the first three months of 2024 — roughly $1.55 trillion. Spending during the January-March span was up 3 percent when compared to the same period last year, despite slackening consumer confidence. This recent rise in spending occurred alongside consumers spreading their purchases across more types of retail, with seven of 10 major categories notching gains. While still… Read More

Bloomberg Features Marcus & Millichap CEO Hessam Nadji Economic Strength and Lower CRE Prices are Creating Opportunity Drivers of the Fed sentiment shift toward “higher for longer”. The up-side of a stronger-than-expected economy for CRE. Are recent price adjustments enough to motivate acquisitions? Why investors waiting on the Fed may miss opportunities.

The Fed and interest rates are important, but have investors missed the big picture? Economic momentum remains sound – what this means for CRE demand drivers How should investors position for the next wave of opportunity?

Energy cost spike bumps up inflation. Mounting costs for gasoline and electricity kept overall inflation elevated over the 12-month period ending in March. The headline CPI measure grew by 3.5 percent during the span, ticking up as the energy index moved into positive territory for the first time since February 2023. Geopolitical conflict, spring-season travel, and energy providers shifting operations amid warmer weather contributed to these higher costs. Fortunately, the seasonality of rising energy prices suggests… Read More

Early Signs Point to Improving Office Sector; Investment Trends Begin to Reflect Changes During the fourth quarter of last year, office net absorption exited the red for the first time in 15 months, pulling nationwide vacancy down 10 basis points. Over 21 million square feet on net was newly occupied between October and December, comparable to an average quarter in 2019. Nearly three-fourths of all major U.S. markets recorded positive net absorption. Key Features Include:… Read More

March logs the 39th straight month of job gains. Employment growth reached a 10-month high in March as 303,000 positions were added, while the unemployment rate adjusted down to 3.8 percent. Hiring was most prominent in health care, government, construction, and leisure and hospitality. Additions in health care and leisure and hospitality, in particular, should help ease staffing shortages in…

Consumers’ priorities reflected in annual gains. While the 2.2 percent year-over-year gain in total core retail sales reported in February failed to match the 3.8 percent rise in core CPI, three key categories bucked this trend. Rising sales amid moderating or falling prices point to what purchases households are prioritizing amid tightening budgets. Factoring in inflation, apparel sales rose 1.3 percent year-over-year in real terms last month, while electronics and appliance sales grew by…

Bloomberg Features Marcus & Millichap CEO Hessam Nadji Office Real Estate Challenges and Opportunities  Does office distress pose a risk to the banking system or is the sector a contrarian play? Which office properties face the greatest challenges and which are outperforming? Current state and outlook for various CRE segments.

Inflation trends cloud Fed’s path. Still-elevated inflation is leading Wall Street participants to delay expectations for the Federal Reserve to start cutting interest rates this year — shifting from spring to summer. Alongside strong hiring in the opening months of 2024, February’s higher headline CPI reading contributed to the Federal Open Market Committee’s  decision to hold the federal funds rate at a 5.25 percent lower bound in March. Fortunately, core CPI, which strips out the more… Read More

The Fed held rates flat as expected but they delivered two important messages What tapered Quantitative Tightening could mean for CRE investors How the rate cut timeline could play out this year