Commercial Economic Summary Q1 2026

Lower Rate Volatility Signals Greater Confidence in the Interest-Rate Path

Since our October update, financial markets have stabilized, though the macro environment remains conflicted. Long-term yields have moved higher, inflation pressures persist, labor conditions have softened, GDP growth has flattened, and tariff uncertainty lingers.  Yet beneath the mixed signals, several developments are constructive for commercial real estate: interest-rate volatility has moderated, pricing have reset, and a significant wave of loan maturities is reaching a decision point. Together, these dynamics may set the stage for a strong commercial year—likely more influential than the next quarter-point move in Fed policy. 

With 2025 transaction volume up 23% year-over-year, most major asset classes posting double-digit growth, and annual volume of $545 billion—comparable to levels seen in the early post-Global Financial Crisis recovery years—the data suggest that commercial real estate has moved beyond correction and into an early recovery phase.