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LightBox: Fed’s Rate Cut Elicits Strong Early Response in CRE Markets
September saw a modest increase in commercial real estate transaction velocity, according to the Monthly CRE Activity Index from LightBox, a provider of CRE information and technology. Driving the uptick was the Federal Reserve’s first cut to the federal funds rate since 2020, spurring a positive reaction from the CRE lending and investment markets.
After August’s Index of 89.9 ended a five-month streak of increases, the September CRE Activity Index rebounded to 98.2, up 8.3 points month-over-month and 10.3 points year-over-year. The increase was fueled by an uptick in commercial property listings, which typically happens after Labor Day.
“The 50-basis-point cut was an unexpected but welcome surprise for CRE, providing a psychological boost,” said Manus Clancy, LightBox head of data strategy. “Even a 25-bps cut would have signaled to the market that a new era of capital deployment has finally begun.”
He added, though, that the recovery could be impacted by recent macro events such as Hurricane Helene, escalating conflict in the Middle East and the upcoming November election. “All of these pose the risk of dampening positive momentum for CRE activity in October and the rest of the fourth quarter,” Clancy said.
- ◦Sale/Acquisition
- ◦Financing
