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Newmark's 2025 Valuation & Advisory North American Market Survey

On March 4, 2025, Newmark Group, Inc. unveiled its highly anticipated Valuation & Advisory North American Market Survey, presenting a comprehensive analysis of key performance indicators within the commercial real estate sector. With the expertise of a seasoned team of valuation and appraisal professionals, the survey provides insights into the evolving market landscape, outlining specific trends in various property categories.

Overview of the Market Survey

The Newmark survey emphasizes several critical metrics including capitalization rates, discount rates, and market growth rates, making it an essential resource for investors and stakeholders. Newmark's team conducted an exhaustive analysis across a range of sectors such as industrial, multifamily, retail, and office spaces, in addition to some non-traditional property types like agriculture, self-storage, and senior housing.

One notable addition to this year’s report is the introduction of the Debt Capital Market Snapshot. This new component aims to provide a deeper understanding of current financial market dynamics with valuable insights into benchmark rates and yields, highlighted by comparisons with historical data.

Sector Highlights

1. Agriculture: The agricultural market in the U.S. is grappling with profitability challenges and uncertainties stemming from federal legislation. However, a report from the USDA indicated a general increase in cropland values across most states, reflecting resilience in this sector.

2. Convenience Stores & Automotive Energy: Fuel consumption saw a decline for the third consecutive year, dropping 5% year-over-year. The $15 billion car wash industry, however, is projected to grow at a vigorous annual rate of 6.1% through 2030, despite the diminished fuel volumes.

3. Hospitality & Gaming: The lodging sector recorded slight growth in Revenue Per Available Room; however, summer demand reduction has moderated overall market dynamics. Slight increases in occupancy rates were noted, bolstered by a reduction in inflation and interest rates.

4. Industrial & Logistics: The national industrial market is experiencing a shift from the peak leasing activity seen in 2021 and 2022, entering a phase of considerable slowdown in 2024, particularly during the fourth quarter.

5. Multifamily: Current market fundamentals in multifamily housing remain robust, although investment levels continue to lag behind the highs observed in the previous two years.

6. Office Space: In central business district areas, higher-quality office spaces continue to outperform others, indicating a selective recovery in demand for premium office components.

7. Residential & Build-for-Rent (BFR): The housing market in the Southeast and Midwest remains in high demand, yet the availability of construction-ready lots remains critically restricted. Concurrently, the BFR market benefits from elevated mortgage rates and home prices, maintaining a national occupancy rate of 95%.

8. Retail & Regional Malls: The retail sector holds steadfast, with an unusually low availability rate of just 5% for retail assets larger than 20,000 square feet, showcasing a strong performance amidst economic shifts.

9. Restaurants: The National Restaurant Association forecasts that 2024 will see sales surpassing $1.1 trillion, marking a historic peak, despite menu prices rising faster than consumer expenditure due to inflationary pressures.

Conclusion

Newmark's 2025 Valuation & Advisory Market Survey paints a detailed picture of the current state and trajectory of the North American real estate market. As industries adapt to new economic realities, this survey serves as a critical tool for stakeholders aiming to navigate the complexities of commercial real estate investments effectively. Newmark's insights affirm their position as a leader in the field, leveraging extensive market intelligence to support clients across various sectors.

For more information about Newmark and to access the full report, visit Newmark's website.