2025 Market Insights
As we move deeper into 2025, the market remains defined by volatility, dislocation and uncertainty. Our senior leaders see not just challenges but opportunities to deploy capital with precision, creativity and discipline
In this episode of Peachtree's Point of View, Greg Friedman welcomes David Bitner, Global Head of Research and Executive Managing Director at Newmark, for an in-depth discussion on the commercial real estate landscape. They cover key economic and market trends, including the impact of sustained higher interest rates, the evolving debt market, and investment opportunities in a rapidly shifting environment. A major theme of the discussion is how higher interest rates continue to reshape commercial real estate valuations.
Commercial real estate investors and operators are facing a fundamental shift in market dynamics, with the era of ultra-low interest rates firmly in the rearview mirror. In a revealing conversation with Greg Friedman, David Bitner, Global Head of Research at Newmark, emphasizes that this change isn't temporary – it's a permanent feature of the investment landscape that requires a complete recalibration of expectations and strategies.
Looking ahead this year, Bitner anticipates continued volatility in interest rates, with the 10-year Treasury likely to run between 3.8% and the mid-5% range. This volatility, coupled with ongoing economic uncertainty, will significantly impact transaction activity and asset valuations across all property types.
Despite these challenges, there are bright spots emerging. Office markets showed their first positive net absorption in 18 quarters during Q4 2023, suggesting a potential turning point. The industrial sector is poised for recovery, particularly in secondary and tertiary markets, driven by near shoring trends and over $530 billion in planned manufacturing investments. Multifamily properties, especially new construction, show attractive pricing dynamics relative to existing stock.
For investors looking to deploy capital, David suggests a balanced approach with a significant allocation to debt investments, where spreads appear more attractive than equity returns. He particularly highlights opportunities in direct lending and mezzanine debt, where returns can reach 14%. On the equity side, he points to value-add opportunities in trophy office conversions, though emphasizing the critical importance of submarket selection.
The wall of debt maturities remains a significant concern, with approximately $2 trillion in commercial real estate loans maturing over the next couple of years. While banks have largely employed an "extend and pretend" strategy thus far, David suggests regulatory pressure and dwindling extension options could force more resolutions in 2025, leading to increased transaction activity and price discovery.
The podcast also touches on potential policy impacts from the new administration, including proposed tariffs and deregulation efforts, which could create both challenges and opportunities for commercial real estate markets.
For investors and operators in commercial real estate, 2025 promises to be a year of continued adaptation to new market realities. Success will require embracing volatility, adjusting return expectations, and taking amore targeted approach to investments across both debt and equity opportunities.
Peachtree Point of View explores today’s complex investment landscape, offering expert insights and actionable strategies to navigate dislocated markets and capitalize on mispriced risk. Each episode dives deep into market dynamics, equipping you with the knowledge to better understand and navigate the ever-changing financial world. Whether you're looking to invest, raise capital, or partner, we’ll reveal the tools and strategies needed to generate superior risk-adjusted returns.
Don’t miss an episode—catch up on past discussions and stay ahead of the curve. [Listen Now]
Related posts
If you enjoyed this article, read through these related press releases and insights.
.png)
.png)
As we move deeper into 2025, the market remains defined by volatility, dislocation and uncertainty. At Peachtree Group, we don’t wait for clarity, we lead through complexity. Despite persistent interest rate headwinds and shifting investor dynamics, our senior leaders see not just challenges but opportunities to deploy capital with precision, creativity and discipline. Here they share candid insights on navigating this evolving landscape, uncovering value where others see risk and positioning Peachtree to emerge stronger on the other side of the cycle.
“The truth is, we’re not waiting for a storm—we’re already in it. In any storm, pain is inevitable, but suffering is optional. For the past several years, we’ve operated in a market shaped by disruption: historic rate hikes, geopolitical shocks and policy uncertainty. We had hoped that we would have seen the darkest moments already, but this cycle had other plans. We’re navigating headwinds in real time, positioning ourselves to endure and emerge stronger. The next six months will likely bring continued volatility with persistent inflation, higher-for-longer interest rates and fragmented capital markets. Still, within that turbulence, signals of clarity are beginning to emerge. As visibility returns, whether through promised tax reform, trade resolution or regulatory recalibration, so too will stability. Our approach is simple. We don’t ignore the storm; we prepare for it. We position our portfolio not to avoid pain but to minimize unnecessary suffering. We are beginning to see the light and are positioned to lead as it returns.” — Greg Friedman, Managing Principal and CEO
“As a team, we’ve successfully navigated downturns, market volatility and shifting political and economic landscapes. Each disruption has only strengthened our resilience and sharpened our edge. While others view unpredictability as discomfort, we see it as an opportunity. It is the space where we thrive, uncovering opportunities to deploy capital and generate exceptional returns.” — Jatin Desai, Managing Principal and CFO
“Volatility continues to define the CRE landscape, disrupting early signs of recovery and forcing a rethink for many market participants. At Peachtree, we remain focused on fundamentals such as location, sponsorship, basis and demand drivers, which tend to outperform through cycles. With traditional lenders pulling back, we are actively financing high quality assets at a premium yield and expect continued opportunity in refinances, loan purchases and situations where execution, not momentum, is what matters.” — Michael Harper, President, Hotel Lending
“The uncertainty of the next 12 months isn’t just about the horizon; it’s about the volatility we face week to week. As transactions pick up, we’ll see the true impact of the value reset, prompting re-margining, recapitalizations or dispositions across the board. With investor liquidity constrained and borrowers under pressure, we expect a rise in structured equity solutions and accelerated asset sales, especially if employment softens and fundamentals weaken.” — Michael Ritz, Executive Vice President, Investments
“We’re operating in a higher-for-longer rate environment, but deals are still getting done—and the dislocation we're seeing now is creating actionable opportunities rather than road blocks. Broken capital stacks, rising distress, and general uncertainty are revealing compelling entry points for preferred equity and rescue capital, where we can participate in upside while preserving downside protection. At Peachtree, we thrive in moments like this—our creative structuring and execution strength allow us to play offense while others wait for clarity.” — Michael Bernath, Senior Vice President, Acquisitions & Dispositions
“Over the next 12 to 18 months, investors will find compelling opportunities to generate attractive, non-correlated alpha through private credit and special situations. Peachtree is actively capitalizing on market dislocation and mispriced risk with strategic, nimble allocations across the capital stack. This environment allows us to play selective offense and deliver strong performance for our LPs. — Daniel Savage, Senior Vice President, Investments & Strategy
“Capital markets volatility, especially in the CMBS and CRE CLO space, creates a unique advantage for lenders like Peachtree that do not rely on securitized executions. As banks are pressured to offload sub-performing loans, we see strong opportunities in the $20–75 million loan range, mainly through deeper stretch senior structures. We remain optimistic about exiting pre-COVID investments and expanding strategies that capitalize on today’s pricing dislocation and policy-driven market shifts.” — Jeremy Stoler, Executive Vice President, Debt Capital Markets
“Market dislocation will drive meaningful opportunities for Peachtree, particularly as refinancing challenges and reduced liquidity sideline many market participants. Sectors like hospitality, multifamily and land remain attractive, especially where bridge and construction lending can solve capital stack gaps. With fewer players in the space and distress beginning to surface, we’re well positioned to deploy capital where others can’t or won’t.” — Jared Schlosser, Executive Vice President, Hotel Originations and Head of CPACE
“Commercial real estate is navigating a uniquely complex moment, shaped by macro pressures like tariffs, inflation and geopolitical fragmentation, and micro realities such as capital expenditure burdens, labor inflation and localized demand shifts. In hotels where reinvestment is non-negotiable and operating costs are rising, the ability to underwrite location, efficiency and adaptive revenue strategies is critical. Today’s dislocation lies in broken capital stacks with unfinished developments, over-leveraged deals, and liquidity-starved sponsors, which are offering compelling opportunities for well-positioned credit investors who can move with precision and discipline.” — Sameer Nair, Senior Vice President, Equity Asset Management
“Uncertainty is sidelining many investors, but that’s precisely where opportunity emerges. We see the most actionable dislocation in debt today, with equity and preferred equity likely to follow. Bridge lending remains compelling, but flexibility across the capital stack is key. While others pause, we’re leaning into select development, knowing today’s starts will be tomorrow’s top assets. Peachtree has grown the most during disruption, and we believe this next cycle will be no different.” — Brian Waldman, Chief Investment Officer
Peachtree Opens Hampton Inn in Hawaii
Peachtree opens Hampton Inn in Hawaii
Hampton Inn & Suites Maui North Shore is now open in Kahului, Maui, Hawaii. The newly built oceanfront hotel, located on the site of the historic Maui Palms Hotel, is owned by Peachtree Group and operated by Springboard Hospitality. The hotel has 136 rooms, ocean-view suites and a design rooted in Maui’s culture.
Read more in this article in Lodging Magazine.
Peachtree Group Opens New Office in Austin
Peachtree Group has expanded its national presence with the opening of its first office outside of its Atlanta headquarters in downtown Austin.
Peachtree Group has expanded its national presence with the opening of its first office outside of its Atlanta headquarters in downtown Austin. This move aligns with the company’s growth strategy and commitment to Texas’ commercial real estate market, according to the company.
With significant investments across the state, including ongoing developments in Dallas and San Antonio and an upcoming project in Austin, establishing an office in the state capital conforms with Peachtree’s long-term vision. Austin’s business environment and growth prospects make it an ideal location to strengthen the firm’s reach and partnerships, according to the company.
Peachtree’s connection to Austin runs deep. The firm has been recognized among the Longhorn 100, a distinction honoring the fastest-growing businesses led by the University of Texas alumni. Additionally, Greg Friedman, Peachtree’s managing principal/CEO, a University of Texas graduate, actively supports the institution by serving on the Real Estate Fund Advisory Board for the Texas McCombs School of Business.
“Our expansion into Austin marks an exciting milestone for Peachtree Group,” said Friedman. “Texas is a critical market for us, and establishing an office in the heart of downtown Austin will allow us to better support our growing portfolio and deepen our relationships in the region. With our ongoing projects across the state and our strong ties to the University of Texas community, this move reinforces our commitment to long-term investment and growth in Texas.”
The new office is in the 100 Congress building and will serve as a hub for Peachtree’s investment and development activities in the region.