Colliers CEO: We seem to be in the beginning of an upside for the first time in three years

Market Outlook & Trends - Five of the biggest commercial real estate companies are raising their outlooks for 2025, the first time all five have increased guidance since 2020 [1] - The commercial real estate cycle seems to be at the beginning of an upside, something not seen in about 3 years [2] - Investors are getting used to higher interest rates, leading to increased activity after a significant decrease [3] - Capital deployment pressure on funds created in the early 2020s is driving activity [4] - Office utilization is up, with a return to a new cadence of more people in the office than not, increasing both leasing and investment sales activity in the last 3 to 4 months [8][9] Interest Rates & Economic Factors - The 10-year Treasury rate is more important than the Fed funds rate for commercial real estate activity; a rate over 4% is considered more manageable than rates heading towards 45% to 5% [6] - The Fed chair's comments at Jackson Hole will influence confidence and activity in the overall economy [5][7] Office Sector Dynamics - Office supply has decreased over the last 4 to 5 years as demand decreased, leading to equilibrium and conversions from office to residential [10] - Conversions from office to residential are happening, especially in areas like lower Manhattan [10][11] Data Centers & Power Constraints - Access to power is creating a ceiling on data center development [11] - Hyperscalers are moving to secondary cities to find new locations with more available power for data centers [12] - The power grid is struggling to keep up with the speed of AI demand [13] Global Strategy & Market Assessment - Diversification across many countries helps smooth out any particular political or other activities [14] - Industrial hubs, including traditional ones like Inland Empire in California and secondary cities, are popular globally [16]