Commercial real estate is at a critical juncture, shaped by shifting market conditions, evolving global trade policies, and tighter financing constraints. In this challenging environment, strategic incentives such as tax abatements, infrastructure support, workforce development grants, and targeted federal programs have become indispensable tools for companies evaluating expansion, relocation, or facility development. Across North America, tenant growth remains cautious, driven largely by tariff uncertainties and persistently high interest rates. Lee & Associates’ Q3 Industrial Market…
2025 Q3 Economic Report
GDP GROWTH: Despite recent labor market weakness that has made headlines along with the government shutdown that began Oct. 1 – stalling release of the Commerce Department’s third-quarter gross domestic product readings – there are several signs that point to continued economic vigor through the end of the year. For example, the Federal Reserve Bank of Atlanta’s real-time gross domestic product growth tracker, GDPNow, is estimating that GDP in the third quarter grew 3.9%, based…
Small Bays, Big Opportunity
INDUSTRIAL REAL ESTATE’S NEXT POWER PLAY The industrial sector has undergone remarkable shifts in recent years. Once dominated by the rise of bulk warehouses and expansive distribution centers, today’s narrative is increasingly shaped by small-bay industrial assets. These under-the-radar properties are becoming more sought after for their sustained demand, resilient fundamentals, and compelling investment potential. While national vacancy rates for large-scale industrial properties have climbed significantly, now hovering around 7.4%, small-bay vacancy remains notably lower…
Sticky But Shifting: Inside the Cap Rate Recalibration
After nearly two years of elevated interest rates and shifting market conditions, commercial real estate investors find themselves at an unusual juncture. Despite clear increases in borrowing costs and economic uncertainty, cap rates remain surprisingly sticky. At the heart of this dynamic is a fundamental disconnect between sellers holding tight to earlier valuation benchmarks and buyers recalibrating for heightened risk. The result is a cautious, fragmented market—one defined less by distress than by recalibration. Nationwide,…
2025 Q3 North America Market Report
INDUSTRIAL OVERVIEW: MARKETS AWAIT TARIFF CLARITY Net absorption of industrial space increased in the third quarter across North America but demand was weak and failed again to keep pace with the supply of new buildings, while tenant growth remained hobbled by tariff concerns and interest rates. In the United States, following 8.1 million SF of negative absorption in the first half, third-quarter tenant growth totaled 31 million SF. That was off 41% from a year…