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Good morning. A strong first-quarter leasing surge may be short-lived as trade tensions and recession fears chill office demand.

Today's issue is sponsored by Enaia—the only next-generation CRE Broker CRM that enriches prospecting and client data with actionable news, insights and contact information.

🎙️ This week on No Cap. CNBC’s Senior Retail Reporter Courtney Reagan joins hosts Jack Stone and Alex Gornik to break down the latest trends in Retail—from Q4 earnings to tariff shocks and everything in between.

Market Snapshot

*Data as of 04/11/2024 market close.

TRADE WAR

TOGETHER WITH ENAIA

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Despite top CRE brokerages investing significantly into technology, CRE brokers are running their prospecting and deal flow with Enaia. Here’s why: 

• Enaia is easy and intuitive to use, unlike enterprise-first internal systems.

• Enaia enriches broker prospect data with contact information such as email addresses and phone numbers.

• CRE Brokers can run complex workflows in Enaia such as multi-market occupier accounts, landlord rep leasing agencies, financial analyses and more.

• Enaia delivers real-time news updates sourced from over 1,000,000 digital news sources.

• CRE brokers can partner safely through Enaia’s “controlled collaboration” features.

*This is a paid advertisement. Please see the full disclosure at the bottom of the newsletter.

• At a Crossroads: Keynote speaker Willy Walker from Walker & Dunlop will share his insights on how the industry is rapidly shifting—only at the Real Estate Symposium at Harvard 2025. (sponsored)

• Cooling down: Construction cost growth slowed to 0.98% in Q1 2025, suggesting the market may be stabilizing after years of steep increases, though tariffs could change that quickly.

• Dropping out: Saks Global has officially withdrawn its Fifth Avenue casino bid, becoming the first major contender to bow out amid regulatory hurdles and shifting priorities while rival proposals continue to gain traction.

• Cycle City: Fueled by $74M in Walton family funding, Bentonville, Arkansas has transformed into a premier cycling destination with 163 miles of trails, drawing riders and redefining the city’s identity.

• Go bigger: The LA City Council greenlit $27.7M in pre-construction funds for a dramatically expanded $2.2B renovation of the Los Angeles Convention Center, quadrupling earlier cost estimates to boost capacity.

• Inventory jump: Eight major US apartment submarkets saw inventory jump over 50% in five years — five are in Texas.

• Filling the gap: Peakline Real Estate Funds is entering the BTR space for the first time with a new fund aimed at underserved rental markets.

• Back on the list: Meridian Capital is back in Fannie Mae’s loan market after a year-long blacklist, though key details remain unclear and new risk protocols suggest extra scrutiny could still apply for lenders.

• Loophole: S2 Capital used a legal loophole to avoid $1.2M in property taxes, spotlighting an affordable housing workaround that Texas lawmakers are still trying to shut down.

• Condo conversions: Workspace Property Trust plans to turn two vacant suburban Atlanta office towers into 449 residential units, marking one of the metro’s largest condo plays in over a decade.

• Onshoring: Trump’s renewed tariffs are fueling a surge in reshoring interest, with manufacturers now driving 19% of industrial space demand.

• Leasing slowdown: New York’s industrial availability rate hit 10.2% in Q1 2025, the highest level in a decade. Record-breaking construction deliveries and a slowdown in leasing activity fuel the rise.

• Grocery-anchored: Sterling Organization acquired the Rossmoor Shopping Center in Walnut Creek, CA for $61.1M—nearly doubling its 2012 sale price. Retail continues to show strength in high-income markets.

• Back in the family: Prada is acquiring Versace for $1.4B, bringing the iconic fashion house back under Italian ownership and betting on its brand power to fuel long-term growth without overhauling its creative identity.

• Job cuts: JCPenney operator Catalyst Brands has slashed another 9% of corporate roles—just weeks after a prior 5% cut—as it restructures amid challenges with underperforming brands like Forever 21.

• Growing pipeline: Austin ranked second nationwide for office construction, with 3.6M SF underway—3.7% of existing stock.

• Doubling down: LinkedIn has acquired a 120,000-square-foot R&D office next to its Sunnyvale HQ for $75M, reinforcing its Silicon Valley footprint amid a broader national office market slowdown.

• Big lease: The Department of Veterans Affairs signed Oakland’s largest lease since 2020, taking 57K sf in a long-vacant tower recently bought by Behring Companies for just $20 per foot.

• Moving forward: Terra and Turnberry's convention center hotel in Miami Beach is back on track, thanks to a $392M construction loan from Tyko Capital.

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