August 2025 |

There’s a growing drumbeat on Wall Street—and it’s not bullish.

Morgan Stanley, Deutsche Bank, and Evercore are all waving red flags. They’re telling clients to brace for a market pullback, possibly in the 10–15% range. If you’ve been watching equities scream higher while economic indicators quietly deteriorate, this moment feels inevitable.

What’s fueling the sell-off fears? It’s a messy cocktail: tariffs, slowing growth, rising unemployment, softening consumer spending, and the quiet return of inflation. Welcome to August.

And, historically, August isn’t kind to investors. Over the past 30 years, the S&P 500 has averaged losses in both August and September. After a bloodbath on Friday, Monday’s bounce was classic dip-buyer reflex—but strategists like Mike Wilson don’t expect it to last. He’s calling for a 10% correction. Evercore’s Julian Emanuel is even gloomier, bracing for a full 15%.

Trump Fired the Jobs Meteorologist

If things didn’t feel surreal enough, President Trump just fired Dr. Erika McEntarfer—the head of the Bureau of Labor Statistics—because the latest jobs report wasn’t up to his liking.

This is like blaming the weatherman for the rain.

You can’t tweet your way out of weak labor data. And if the administration wants “beautiful” numbers instead of accurate ones, it risks eroding the trust that markets and businesses rely on.

Meanwhile in CRE: Dallas Is On Fire

While equities are wobbling, commercial real estate is showing surprising strength—especially in Dallas.

CRE investment surged in the first half of 2025, with U.S. volume hitting $182.4B, up 25% year-over-year. Nearly 12,500 transactions were recorded, a 15% increase. Leading the charge? Dallas–Fort Worth, with $13.5B in deals—89% growth over last year, and 57% more than San Francisco.

Multifamily led the boom, accounting for $6.3B across 153 deals (up 140% in volume). Land deals jumped 681%—not in count, but in value—showing just how sharply prices have climbed.

Even office is stirring again. New York, LA, and D.C. are seeing real activity, with many of the largest deals going to end users—an encouraging vote of confidence in long-term office usage.

Multifamily deliveries are expected to peak this year, but 2026 starts may fall by more than 50% as developers get squeezed by costs, tariffs, and cautious capital. Core metros like NYC, LA, and Chicago are still tight (<5% vacancy), and institutional capital is starting to re-enter markets like DFW, Denver, and D.C.

The 2025 CRE Outlook: Holding Firm in a Storm

CBRE just released their midyear outlook—and while growth is slowing, fundamentals are still solid. Here are the key takeaways:

• CRE investment is expected to grow 10% in 2025, despite macroeconomic headwinds.

• Office leads the rebound with a projected 19% growth in deal volume.

• Prime assets (office, retail, data centers) are outperforming—flight to quality is real.

• GDP forecast cut to 1.5%, with inflation projected at 3.1% and unemployment rising to 4.4%.

In other words: the market isn’t booming, but it’s far from broken. Strategic capital is still moving—and in some cases, accelerating.

Sector-by-Sector Breakdown:

Office:

Demand is centered on Class A space in gateway markets. Tenants are trading up, leaving behind aging buildings. Prime vacancy is at 14.5%—well below non-prime.

Industrial:

Leasing is stable, but vacancy is creeping up as older space gets left behind. Construction delays and rising costs are slowing new supply. 3PLs are driving demand, especially in the Midwest and central corridor.

Retail:

Yes, we’re still seeing fallout from bankruptcies, but high-traffic power centers and grocery-anchored retail are thriving. Core markets are competitive again—some are even seeing bidding wars for anchor space.

Multifamily:

Rent growth is back—sort of. It’s uneven, with the Sun Belt feeling the oversupply pinch. National rent growth is forecast at 2.8% annually over five years, slightly down from earlier expectations. Vacancy sits at 4%, but likely won’t stay there long as deliveries ramp up.

Data Centers:

Still the darling of CRE. Demand is white-hot, but power infrastructure is the bottleneck. Dallas and Silicon Valley are seeing delays—developers are turning to temporary and on-site power solutions just to stay on schedule.

Final Thoughts

In a market this complex, it’s easy to get distracted by noise. Tariffs, elections, inflation—it’s all real, but it doesn’t change the core truth: high-quality real estate is still outperforming, and capital is hunting for safe, long-term yield.

The smart money is leaning into selective plays—especially in multifamily, office repositioning, and mission-critical assets like data centers. If you’re well-positioned, 2025 might be a time not just to hold—but to move.

Stay focused. Stay informed. And above all—stay opportunistic.

Daniel Kaufman

Real Estate Developer & Investor