Marcus & Millichap (NYSE:MMI) Update / briefing Transcript

Summary of Marcus & Millichap Update / Briefing (January 22, 2026) Company Overview - Company: Marcus & Millichap (NYSE: MMI) - Established: 1971 by George Marcus and Bill Millichap - Focus: Real estate investment brokerage and information delivery to the investment community [3][4] Economic Outlook for 2026 - GDP Growth: Expected to be between 2.5% and 3%, an improvement from 2025's growth of 2% to 2.5% [7][8] - Unemployment Rate: Currently at 4.4%, projected to rise to between 4.5% and 5% by next year [8] - Key Growth Drivers: - Artificial Intelligence (AI): Significant investment in data centers and AI-related infrastructure, with the U.S. leading globally [10][11] - Fiscal Stimulus: Tax cuts and increased government spending expected to boost GDP by approximately $100 billion, contributing 2%-3% to GDP [13] - Headwinds: - Deglobalization: Ongoing tariffs and restrictive immigration policies impacting job growth [9][14] - Labor Market: Job growth has stagnated, with healthcare being the only sector adding jobs [15][16] Risks to Economic Growth - K-shaped Economy: Increasing income inequality affecting consumer spending, with the top 20% of earners driving a significant portion of economic activity [18][19] - Equity Market Valuations: High valuations in the stock market pose a risk if AI adoption does not lead to expected productivity gains [20][21] - Bond Market Fragility: Concerns about potential dislocation in the bond market, which could impact financial and real estate markets [22][23] Commercial Real Estate Insights - Market Trends: - Apartments: Stable vacancy rates below 5%, but a significant drop in multifamily starts (72% from peak) and units under construction [36][39] - Office Market: Gradual recovery with improved daily attendance, but significant variance in vacancy rates between older urban and newer suburban properties [48][50] - Industrial Market: High vacancy rates due to a surge in construction, but demand remains steady for smaller, private investor-owned facilities [51][58] - Housing Affordability: Only 28% of Americans can qualify for a typical first home purchase, leading to increased demand for rental housing [39][46] Federal Policy and Housing Market - Proposed Limitations: Recent federal proposals to limit acquisition of single-family homes driven by political pressures related to affordability concerns [42][43] - Supply Focus: Emphasis on increasing housing supply as a solution to affordability issues, with ongoing advocacy for policies that support this goal [44][46] Conclusion - Overall Outlook: 2026 is expected to be a better year for operations and rent growth due to supply pullback and strong demand, although challenges remain in the labor market and economic risks persist [47][48]