The TreppWire Podcast: A Commercial Real Estate Show
Episode 366: 2025 Issuance Tops $120B, Fannie/Freddie Lending Caps, NYC–Cincinnati Office Pricing Gaps, Market Trends & More
Date: December 5, 2025

Episode Overview

This episode dives into the latest trends shaping the commercial real estate (CRE) market. The hosts tackle how macroeconomic data, consumer spending, and Federal Reserve policy create ripple effects in CRE, with a particular focus on multifamily housing. Discussion highlights include the significance of Fannie and Freddie’s raised lending caps, shifts in consumer and investor behavior, notable transaction activity across property types, and the state of market pricing in major and secondary U.S. cities.

Key Discussion Points & Insights

1. Macro Backdrop: Consumer Spending & Policy Uncertainty

[00:05–04:28]

• Macro Sentiment:
  Consumer spending remains robust, according to Black Friday data, but much of this is being driven by inflation and selectivity rather than true demand surges. The labor market is cooling, yet not collapsing.

• Fed Policy:
  The probability of a December interest rate cut is high, but not guaranteed. Markets are expecting a 25 bps Fed cut in 2025, with CME FedWatch showing about a 90% probability.

  "On the one hand, consumers are still spending, the labor market is cooling but not cracking ... On the other hand, Powell's been very clear a December cut is not a done deal and the committee is split." - Steven [02:02]

2. Multifamily Market: Growing Vacancies & Lending Caps

[04:28–10:20]

• Underlying Dynamics:
  Record Black Friday sales conceal lower order volumes and higher average prices, implying inflation-driven growth. Buy Now, Pay Later services play a growing role, indicating consumers are leveraging debt.

• Vacancies & Rent Trends:
  National multifamily vacancy is at a record 7%, with new supply outpacing demand. Rents are down another 1% MoM and 5% from the 2022 peak.

  "Vacancy for multifamily nationally sits at just over 7% which is a record high ... rents are down just over 5% from their 2022 peak." - Lonnie [06:54]

• FHFA Caps:
  FHFA increases multifamily lending caps for Fannie and Freddie to $88B each (a 20% YoY jump), sending a strong liquidity signal to markets facing refinancing pressures.

  "When we get disruptions in the market, having the agencies with more room to lend is a clear backstop for liquidity in the multifamily space." - Steven [03:53]

3. Consumer Constraints: Housing and Autos

[10:20–13:35]

• Consumer Budget Stress:
  Car prices are forcing consumers to cut back, echoing the reality of binding household budget constraints.

• Single-Family vs. Multifamily:
  Softening rents and owner-occupant housing adjustments could push inflation below the now-sticky 2.5% level, raising new questions on lasting affordability.

  "We're now at the binding budget constraint for the consumer ... with rents declining like they are, I just can't help but wonder, what are we going to see on the owner side for single family?" - Steven [10:42]

• Auto Market Anecdote:
  The exchange over luxury SUVs and consumer resilience underscores persistent debt-supported demand, as affordability remains a key theme.

4. Single Family and Market Cycles

[14:37–18:44]

• Resi Listing Trends:
  Time on market and price cuts are up, especially for commoditized or highly leveraged homes. High leverage is tying sellers' hands on cuts, echoing concerns from the 2008 crisis era.

  "The problem for sellers is a lot of these folks are just super leveraged on prices that were inflated. And so they can only do so many price cuts before they're in the red ..." - Lonnie [15:08]

• Market Intervention:
  Real market recovery requires recognition of losses—artificial support, like the FHFA lending cap, although good for multifamily, distorts competition versus other property types.

5. Fannie/Freddie Increase & CMBS Issuance

[18:44–24:39]

• Caps Contextualized:
  $176B combined cap is a 20% increase, providing a liquidity backstop through 2026. The agencies won’t decrease caps even if the market shrinks, but will raise further if needed.

• 2025 Private Label Issuance:
  Exceeds $120B, marking two strong years in a row. Forecast for 2026? Anything above $95B is “productive”; below $75B would be “catastrophically bad.”

  "If we drop below 90 billion, let's say it looks bad, but there's at least that hint of softness in that number. Gosh, yeah. If we go below 75, that's a catastrophically bad year. I don't see, I don't see us getting that low." - Steven [23:12]

6. Sentiment & Notable Quotes

[24:39–25:56]

• Catchphrases for 2026:
  • "Buy some sticks and bricks in 26"
  • "Survive until 25 is now fix on 26." (Listener Jeffrey S.)
• Outlook is shifting from “cautiously optimistic” to full-on optimism.

7. Demographic Pressure: Young Adults at Home

[26:04–29:38]

• Household Formation:
  32% of 18–34-year-olds live at home—a stat in line with previous years but one that raises questions about future multifamily demand and absorption.

  "Basically one in three people under the age of 34 are living with family. That’s pretty significant. ... Just 10% of the 32% [moving out]... you might start seeing that absorption number get pushed and rents might swing back..." - Lonnie [26:29]

Transaction Roundup & Market Data

Apartments & Assisted Living

[30:28–33:34]

• Seattle: GT Capital & Freestone Capital pay $43.7M ($227k/unit) for Lock Vista Apartments (Ballard), renovated vintage property.
• Berkshire Residential buys Walton Lofts for $55.7M ($409k/unit), indicative of price per unit variance driven by location and asset quality.
• Florida: Welltower acquires Barclay at Park Square (Aventura) for $46.88M ($332k/unit, assisted living).

Retail

[34:21–37:47]

• Omaha: Federal Realty pays $153M for Village Point ($337/sq ft), nearly fully occupied and anchored by high-credit tenants.

• Florida: Maven Real Estate grabs a Coral Springs shopping center for $40.5M ($205/sq ft).

• Phoenix: Local investor pays $45M ($553/sq ft) for Paradise Valley Marketplace (restaurant supply store backfills exiting Whole Foods).

  "That last one is particularly creative. ... Putting in a restaurant supply store to backfill Whole Foods. I mean, I like it." - Steven [37:14]

Office

[37:47–43:33]

• NYC: Capstone buys 205 W 28th St for $80.71M ($883/sq ft), while Empire State Realty Trust acquires Scholastic’s HQ for $386M ($974/sq ft). Sales prices approach 2017–2018 “peak” levels, hinting at potential market recovery in select assets.
• Cincinnati: First Financial Center trades for $59M ($106/sq ft), the largest office deal in years for the market.
• Pricing Gaps: NYC trophy office averages above $800–$900/sq ft, while major Cincinnati office assets are a fraction of that, illustrating “dynamic differences in these markets.”

Notable Quotes & Moments

• On CRE underwriting:
  "You've got to dig deeper than the headlines." - Lonnie [04:28]
• On market pain:
  "The market cannot go through the full cycle until losses are realized. Anything outside of that is just market manipulation, government intervention, whatever you want to call it." - Lonnie [17:03]
• On sentiment:
  "We want full on optimism—capital O." - Lonnie [25:42]

Important Timestamps

• 00:05: Show opening, macro overview, and holiday sales tie-in
• 02:02: Macro & CRE bridge; multifamily sentiment
• 06:00: Unpacking Black Friday & consumer spend
• 10:20: Multifamily distress outlook
• 15:08: Single family price trends vs. office market
• 18:44: Fannie/Freddie caps context and implications
• 23:12: 2026 origination volume benchmarks
• 26:29: Household formation stat (young adults at home)
• 30:28: Weekly CRE transaction roundup (apartments, retail, office)
• 40:56: NYC vs. Cincinnati office sale comparison & market perspectives
• 43:43: November delinquencies, TPPI release, and upcoming webinars

Listener Engagement & Shoutouts

• Community feedback features prominently, especially around Spotify Wrapped shares and listener predictions.
• Webinar (Dec 11) and access to CMBS delinquency and property index data available upon request.

Tone & Language

The hosts blend sharp market analysis with humor and industry camaraderie (“Buy some sticks and bricks in 26”; “complete each other’s sentences”). The conversation is candid, featuring ground-level anecdotes and practical takes alongside deep data insights.

For CRE investors, lenders, and market-watchers, this episode is a fast-paced, data-driven tour of year-end conditions and outlooks across property types, regions, and policy fronts—anchored by actionable insights and real-world deal perspectives.