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Midyear 2026: 'Measured Confidence' Means Buy Carefully, Not Wait

CREagentic TeamJuly 1, 20265 min read

What the reports agree on

CBRE expects 2026 investment volume to rise 16% to $562 billion, close to the pre-pandemic annual average. Office vacancy has fallen four quarters in a row and absorption is positive. The AI infrastructure build is generating demand across data centers, industrial and the office markets that serve them. Values are still well below their 2022 peaks, which makes real estate look cheap relative to stocks and private credit. And the gap between the best assets and the rest is getting wider, not narrower.

They also agree on the risk. The Fed is on hold with a bias toward a hike, the 10-year is above 4.3%, and a large volume of 2021 and 2022 loans matures in the next 18 months at coupons 200 basis points above where they were written.

For buyers

The first half rewarded buyers who had equity, committed debt and a short list. It will keep rewarding them. The asset to buy is the one the seller must sell: a maturity the sponsor cannot refinance, a fund at the end of its life, a lender with a foreclosed building. Those sellers price to close. The asset to avoid is the one priced on a "rates will fall" story, because the seller will not move and you will not get paid for the risk.

Underwrite to today's debt cost, no cut in the model. If the return works on that basis, any cut that comes is a bonus, and if it does not work you are buying a bond with a leasing problem.

For sellers

The transaction market is open for anything with a clean story: stabilized, leased, no capital needs, in a sector buyers want. That is the widest the window has been since 2022. It will not stay open through a hiking cycle. If you have an asset you would not buy at today's price, sell it before September's Fed meeting and let someone else own the rate risk.

Sellers with a problem asset should fix the fixable part first. A lease abstract package, current estoppels, a reconciled rent roll and a capital plan turn a 60-day due diligence into a 30-day one, and shorter due diligence is worth 2% to 3% on price in a nervous market. Buyers pay for certainty.

For lenders

Spreads have come in and competition for the best loans is back. The mistake in 2021 was lending on the business plan instead of the in-place income. The temptation now is the same, dressed up as "the recovery is here." Size the loan to the income the building earns today. If the sponsor's plan works, they will refinance with you at a bigger number in three years. If it does not, you will be glad you did not fund it.

Shorter due diligence is worth 2% to 3% of price. Here is where the time goes.

Buyers pay for certainty. The seller who delivers abstracted leases, current estoppels, a reconciled rent roll and a capital plan on day one of due diligence gets a buyer who closes in 30 days instead of 60, and in a nervous market that buyer pays more because the seller's own lender gave the deal fewer chances to fall apart.

The package that makes it possible is mostly reading and reconciliation, which is exactly the work software does well now. Abstracts in a day rather than a month. Estoppels pre-filled from the leases rather than typed from the rent roll, so the tenant corrections are fewer and the closing condition is met on time. A rent roll checked line by line against the lease schedules, which finds the billing errors before the buyer's analyst does. Sellers who prepare this way spend less on counsel, lose fewer deals in due diligence, and hand the buyer nothing to re-trade on. That is where the 2% to 3% comes from.

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