| | | | | | | | | | It’s easy to look at a 10% drop in the U.S. dollar and say, “Buy the dip.” But in commercial real estate, nothing is that simple — especially in 2025, a year that hasn’t exactly gone to plan for CRE’s biggest C-suite kahunas. Foreign direct investment into the U.S. just hit its lowest quarterly level since 2022, and the weak dollar isn’t aggressively luring capital back. Why? Because it’s not just about currency conversion. It’s about confidence. Global investors aren’t convinced the U.S. is a safe bet right now. Between President Donald Trump’s tariff roller coaster, a $3.3T projected deficit jump from the One Big Beautiful Bill Act, and hedging costs that eat into margins, the math isn’t adding up for everyone. But that’s not the whole story. | | | | | | | | To some, the U.S. looks like it’s on sale. Astor Realty and Impex Capital say foreign limited partners are starting to circle again, especially in coastal cities and Sun Belt hubs like Houston. The question isn’t whether the money will come — it’s where, when and what risk it’s willing to swallow. This isn’t a story about a crashing economy. It’s a story about perception, volatility and what kind of bets CRE players are willing to make when the ground feels less solid than usual. READ: The U.S. Dollar Is Down 10% So Far This Year. Here's What That Means For CRE — Mark F. Bonner, Kayla Carmicheal, Jay Rickey and Catie Dixon Not getting The First Draft in your inbox? Click here to sign up. Got any feedback or a news tip? Email first...@bisnow.com. You can catch all episodes of First Draft Live here. CRE News Quiz In The Hangover (2009), an automobile became as much of a star in the movie as the actors. What luxury brand was the car, and why was that company in CRE headlines this week? (Answer at the bottom.) On Our Radar Finally, a flat line … net lease cap rates are stabilizing. Cap rates in the single-tenant net lease sector barely moved in Q2, ticking up just 1 basis point to 6.79%, according to The Boulder Group — a welcome pause for sellers after three straight years of steady increases. While broader CRE cap rates continue rising in response to high interest rates and risk repricing, net lease is showing early signs of stabilization as investors see the property type as a safe haven. Industrial held flat while retail and office saw minor bumps. For cap rate watchers, this signals that at least one corner of the market may be nearing a pricing equilibrium. Naftali brushes off Miami hype after NYC political shake-up. Residential developer Naftali Group CEO Miki Naftali dismissed the idea that Zohran Mamdani’s New York mayoral primary win is fueling a new migration wave to South Florida, calling it “just stories.” Naftali told Bisnow that NYC is still booming and comparisons between the cities are tired. Despite being late to Miami’s postpandemic surge, NYC-based Naftali now has two major projects underway in South Florida. The real threat to new development? “Some projects … will not be able to be built because the cost is too expensive,” he said. The write-off that built America (again)? The One Big Beautiful Bill Act is trying to fuel a manufacturing surge by extending 100% bonus depreciation to full production facilities — an upgrade from the 2017 Tax Cuts and Jobs Act, Avison Young reports. With $3.5T in projects announced and deadlines looming, companies are racing to build. But the boom masks deeper strain: U.S. manufacturing still makes up less than 10% of GDP, the purchasing managers’ index has contracted four months straight, and looming tariffs on 14 countries could disrupt supply chains. Still, developers and owner-users are pouncing on shovel-ready land and tax breaks. AY warns: Move fast or miss the moment. This week on First Draft Live … We’re sitting down with Camden President and CFO Alex Jessett to unpack the One Big Beautiful Bill Act and its specific implications for U.S. housing policy and multifamily. From massive LIHTC expansions to brutal Medicaid cuts, the stakes couldn't be higher for multifamily players. Don’t miss this unsanitized conversation on the future of America’s rental economy. Register here.
On The Charts: Retail Leasing | | | | Courtesy of Colliers | | | | | | | | Retail leasing had its worst quarter in four years, as a 5.2% decline in leasing activity led to 6.4M SF of negative net absorption in Q2, Colliers reports. It chalks the drop up mostly to a scarcity of space anyone actually wants, saying less than 25% of available space was built in the last quarter century. A wave of store closures that started in late 2024 is affecting both absorption and rents. Asking rents declined nearly 40 bps last quarter to $25.46 per SF. National retail vacancy is 4.3%, a 10 bps increase QOQ but still well below historical averages. This Morning’s News RETAIL — Closures Outpace Openings (Bisnow): 67% more stores have shuttered this year than last year, leaving 50M SF vacant. There were 119 closures in the first week of July alone. Eleven retailers plan to close over 100 locations this year, including 7-Eleven and Forever 21. Read more here.
MANUFACTURING — Pentagon Backs $400M Rare Earth Magnet Plant (Bloomberg and MP Materials): MP Materials will build a new facility with funding from the Department of Defense, aimed at reducing U.S. dependence on Chinese rare earth magnets critical for EVs, missiles and other tech. It hasn’t selected a location. Read more here and here.
LEGAL — Oak View Group CEO Indicted In Bid-Rigging Scheme (Bisnow): Charges allege Oak View CEO Timothy Leiweke and a competitor worked for over six years to fix the contract bidding of the $375M Moody Arena at the University of Texas campus. Oak View Group won the bid to develop, manage and operate the arena, which opened in 2022. It will pay $15M in penalties for Leiweke's alleged misconduct. Read more here.
| | | | | | | | Wikimedia Commons/The Trump White House | | | | | | | | DATA CENTERS — Trump Order Imperils Billions In Clean Energy Projects (Bisnow): Solar and wind developments had scored a win in the final version of the One Big Beautiful Bill, but a new executive order from Trump is now restricting those tax incentives. That’s bad news for the data center industry, which says it needs an expansion of renewable energy to continue building. Read more here.
INVESTMENT — CRE Dealmakers Say Outlook Is Improving (CoStar): Institutional investors are becoming more confident about deploying capital, especially later in the year, despite economic uncertainty. Read more here.
DEVELOPMENT — Architectural Billings Rise (World Property Journal): The AIA’s Architecture Billings Index ticked up slightly in May, signaling modest improvement in design demand, particularly in the South and West. However, overall activity remains below growth thresholds. Read more here.
CORPORATE RELOS — Nevada Emerges As Early Victor In 'Dexit' (Yahoo Finance): At least seven major public companies are voting on a move from Delaware to Nevada this earnings season because of its business-friendly tax structure, lower costs and proximity to the West Coast. Read more here.
TARIFFS — Trump's New Copper Tariffs Fuel Border Rush (Reuters): A 50% tariff on copper imports, primarily targeting Latin American supply, is expected to disrupt pricing and spark a surge in short-term shipments before the levy kicks in. Read more here.
PROPERTY MANAGEMENT — StorageMart JV Adds 2M SF Of Metro Storage Facilities (StorageMart and Manhattan Mini Storage): The joint venture with Manhattan Mini Storage continues to grow its third-party management arm, onboarding 18,672 units across 27 properties in seven states. Read more here.
RETAIL — Nordstrom To Shutter 2 More Department Stores (CoStar): The retailer cited underperformance and ongoing retail headwinds in announcing closures in San Francisco and Cleveland, continuing a multiyear contraction. Read more here.
| | | | | | | | Unsplash/Bill Mead | | | | | | | | INVESTMENT — Rooftop Solar Financing Hits A Wall (WSJ): Rising interest rates, policy shifts and investor skittishness have ground rooftop solar securitization to a halt, stalling a financial engine that once pumped billions into residential clean energy. Read more here.
CONSTRUCTION — Pretium Deploys $1B In Homebuilder Loans (Pretium): Pretium says it has now originated over $1B in loans across 20 states, funding thousands of homes through its expanded builder lending platform. Read more here.
M&A — Compass Snaps Up Denver-Based Brokerage PorchLight (Compass): The national firm expands its Colorado footprint with the acquisition of PorchLight Real Estate Group, which has nearly 200 agents and a stronghold in Denver’s urban neighborhoods. Read more here. *** BTW … Most-read story on the website yesterday: Youth Sports' Billion-Dollar Building Boom Has Developers, Cities Playing Ball Most-clicked story in yesterday’s edition of the First Draft: Welcome To Halftime: 40 CRE Execs Talk Tariffs, Delays — And A Year That Hasn't Gone To Plan A season of mystery: Big Brother 27 premieres tonight on CBS/Paramount Plus, and Kayla couldn't be happier to see what the Clue-inspired mystery theme will bring the houseguests. So You’ve Come For An Answer Mercedes-Benz. Several wheels from the brand were used in the film, but the most prominent was the 1965 Mercedes-Benz 220SE Cabriolet. Mercedes-Benz announced a deal with Federal Realty Investment Trust this week to bring 500 electric vehicle charging centers to its retail properties. *** The First Draft is produced by Director of Newsletters Jay Rickey, Managing Editor Catie Dixon, Editor-in-Chief Mark F. Bonner and Deputy Newsletter Editor Kayla Carmicheal, with an assist from AI. We’d love your feedback! Email us at first...@bisnow.com. | | | | | | | | | | | | | | | | | | | | | |
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