See Today What Others Will Tomorrow
Is your commercial real estate portfolio ready for stagflation?
Across commercial real estate, vacancy rates are on the rise, while rents are headed lower. With inflationary pressures mounting and the economy decelerating into recession, CRE investors are facing the most challenging market and economic environment since the 1970s. An environment that most CRE analysts don’t understand, let alone know how to help their clients navigate. Since the world turned upside down in 2020 I have been one of the most accurate economic forecasters and best analysts in CRE, and I’ve got the receipts to prove it!
If you’re tired of getting investment advice from industry “cheerleaders” and you want trustworthy and valuable information, you’ve come to the right place. At Roundtree Consulting, you get the answers to the test before the competition even figures out the question. Subscribe and See Today What Others Will Tomorrow!
CHECK MY RECEIPTS
2025
GENERAL CONSENSUS – At the start of this year, most analysts predicted a big rebound in industrial demand, putting it back in alignment with shrinking supply levels and supporting strong rent growth.
MY TAKE – “Given that demand is quickly trending into negative territory, the problem of excess supply will likely continue, putting more upward pressure on vacancies and downward pressure on rents.”
– Industrial Watch magazine, January 2025
OUTCOME – Net absorption contracted for the first time in Q2 since the aftermath of the Great Recession. Meanwhile, vacancies hit a 12-year high, and annual rent growth dropped to 2012 levels.
2024
GENERAL CONSENSUS – Last year, the financial community anticipated that rate cuts by the Federal Reserve on bank-to-bank lending would lower Treasury rates and thus mortgage rates.
MY TAKE – “Industrial investors sitting on the sidelines waiting for lower (mortgage) rates should consider that rates may not be significantly lower in the future and potentially even higher.”
– Industrial Watch Blog, May 18, 2024
OUTCOME – The Fed cut rates by 100 bps by the end of 2024, but Treasury and mortgage rates jumped by roughly 100 bps during that time.
2023
GENERAL CONSENSUS – At the peak of the industrial boom, most analysts predicted an indefinite shortage of big-box warehouse space.
MY TAKE – “Just a year ago, the thought of overbuilding (big box warehouses) seemed unthinkable, but the change in economic winds has made this a reality, exposing a divergence between big box and small industrial in the process.”
– Industrial Watch magazine, January 2023
OUTCOME – From 2023 to mid-2025, big-box vacancies (driven by oversupply) increased by a record 5.1 percentage points to 9.5%, doubling the 4.6% vacancy rate among small industrial properties.
2022
GENERAL CONSENSUS – When the Fed began to aggressively raise interest rates, most CRE analysts claimed that the economy would avoid a financial crisis and that sales activity would hold up.
MY TAKE – “…the Federal Reserve’s attempt to fight inflation will likely result in a financial crisis…Given how sensitive commercial real estate is to interest rates, transactions could suddenly drop again…”
– Industrial Watch magazine, July 2022
OUTCOME – The Regional Banking Crisis broke out in the spring of 2023, marking the largest string of bank failures since the Great Recession. CRE transactions collapsed by 40% that year, the most since the Great Recession.
2021
GENERAL CONSENSUS – As prices rapidly increased around the world, most CRE analysts echoed the chairman of the Federal Reserve, calling inflation “transitory” and expecting prices to fall when the economy reopened.
MY TAKE – “The Federal Reserve maintains that these price increases are simply transitory… However, this does not appear to be the case.”
– Industrial Watch magazine, July 2021
OUTCOME – The Consumer Price Index peaked at 9.0% during the summer of 2022. Prices have yet to fall back to 2020 levels, and the CPI remains above the Fed’s 2.0% target.
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