Welcome to the deep dive. Everyone we’re here with a fresh look at the commercial real estate market brought to you, of course, by Eureka business group. And we’re kicking things off with, well, some really exciting news, especially for those of you keeping an eye on retail in the DFW area. Of course, you’ve got it.

We’re really diving deep today into the CBRE 2025 global investor intention survey. It’s a March, 2025 report, and it’s really insightful, really gives us a valuable look at the global picture of where’s the money going. And commercial real estate that is. And for us here at Eureka Business Group, we love to use these global insights.

to really get a good grasp on what’s happening locally, right here in our DFW market, when it comes to opportunities and trends. You know, I completely agree. I mean, this survey is pretty comprehensive, right? They polled over 1, 400 investors all across the globe, the US, Europe, Asia Pacific, back in late 2024.

That’s a pretty broad view of what investors are thinking and feeling. And of course, that has major implications for what we can expect. Right here in Dallas Fort Worth. So today our goal is simple. We want to take all these global insights and boil them down to what matters most for you, if you’re looking at investing in DFW commercial real estate, with a special lens, of course, on the retail sector.

Sounds good to be. So let’s start big picture, big picture stuff. What’s the overall sentiment? Well, across the board, the US, Europe, Asia Pacific, we see a clear majority, clear majority of investors planning to at least maintain, if not increase. The real estate acquisitions going into 2025 compared to last year.

Now, what does that tell us? It tells us there’s this underlying confidence globally in real estate as an asset class. Yeah. I mean, that’s a pretty strong endorsement, wouldn’t you say? And you know, the report does point out that there has been a little bit of an increase in caution among us and European investors since they took the survey probably has something to do with.

Expectations around interest rate cuts, maybe not as many people were hoping for, but it’s super important to remember that capital is still flowing into U. S. real estate. We’re seeing it. CBRE is seeing it. More bidder activity. You know, it’s something we’re definitely observing here in DFW. It’s happening.

Absolutely. And if we, if we turn our attention to Asia Pacific, we see an even rosier outlook. Investors there are pretty convinced that interest rates have peaked. And they’re, they’re ready to jump back in, ready to deploy capital after things were a little slower. And, and you know what, Japan, Japan is a really interesting case.

The report highlights how they’re actually anticipating. Rising rents, even though monetary policy is still pretty tight. So what does that tell us? Strong demand. Very strong underlying demand for real estate in Japan. I love how these regional nuances come into play. It’s fascinating. But let’s, let’s shift gears a bit.

Talk about what’s driving these investment decisions. The survey reveals some interesting regional differences. For instance, U. S. and European investors, their top reason for upping their capital allocation is favorable pricing. So how does this actually play out, especially for someone looking at acquisitions here in Dallas Fort Worth?

Well, in the DFW market, that phrase, favorable pricing, often boils down to cap rates, black rates or capitalization rates, shifting and certain, retail subsectors. This metric essentially tells us. About the potential return on an investment and what we’ve observed is these rates going up in some pockets of the market meaning Acquisition prices are looking more appealing compared to the income those properties are bringing in so for investors Looking for specific yields in our local retail market.

Well, this creates some pretty compelling opportunities It’s all about understanding those local dynamics and that’s what makes this so valuable now Asia Pacific. What’s fueling their investment engine? Well, for them, the big driver is expectations around lower debt costs, which of course ties into the idea of interest rates easing in that region.

But across the board, across all regions, we see stabilizing, maybe even decreasing interest rates and improved expected total returns. These are the factors really motivating investors to, well, to keep their eyes on commercial real estate. Yeah. And these economic indicators certainly suggest that it might just be the right time.

To think about strategic investments, don’t you think? I’d agree with that. Okay, so let’s dig into preferred investment strategies now. The report, it clearly shows a strong preference for value add across all three regions. Now, for some of our listeners, they might not be as familiar with this term. So can you unpack it a bit?

What does value add actually mean? And why is it so hot right now, especially in the DFW retail world? Sure, happy to. So think of it this way, value add. It’s all about finding properties that aren’t living up to their full potential. Maybe they’ve got management issues. Maybe the design is outdated. Maybe the tenant mix just isn’t right.

Whatever the reason, you see an opportunity to step in. Make some strategic improvements. Change things up operationally. And boost the value, boost the returns. Now in the DFW retail scene, this could mean buying a shopping center, great location, but it needs some love. Maybe modernize it, bring in some fresh tenants that really resonate with the local community.

Or even, you know, reconfigure the space to create something new, something experiential, or cater to those service based businesses that are in high demand. And the current climate, well, with prices adjusting, it makes these value add projects. Really, really appealing. The potential for returns is strong.

So essentially, an investor here in DFW might come across a shopping center. High vacancy rate, but it’s in a growing suburb. They see that potential, invest in renovations, attract a big anchor tenant, and boom, the whole property is revitalized. Value skyrockets. That’s the idea. It’s happening all over DFW.

Strategic repositioning. Now, the report also highlights Core Plus As, a popular strategy. In the DFW retail context, think of Core Plus As, taking a stable shopping center. Good location. And then, you make some tweaks, maybe a few upgrades. Attract a couple of key tenants, just to give it a little boost, in terms of income and appeal.

You know, it’s pretty remarkable that even with the, you know, the perceived risk being a bit higher in Europe, Value added still king really shows you that active management, it’s a powerful tool for driving returns and the fact that Asia Pacific investors, they’re also looking at core and core plus after the price corrections.

It just reinforces the idea that real estate fundamentals are solid. Yeah, there’s this underlying belief that well located properties, they’ll, they’ll continue to appreciate. So let’s talk sectors, preferred investment sectors. This is where it gets really interesting, especially for our DFW retail folks.

Yeah, absolutely. This is the juicy stuff. Now, globally, multifamily and industrial and logistics are leading the pack, that we get it, right? Demographics, housing affordability, e commerce, it’s all playing a role. But what about retail? How does retail fit into this picture, especially for U. S. investors? Well, this is a big one.

A big takeaway for anyone interested in the DFW market, the CBRE report, it specifically points out an uptick, a noticeable uptick in us investor interest in retail assets. And this, this surge in interest is directly tied to. Increased leasing activity that CBRE has been seeing. So for us here in Dallas, Fort Worth, this is a major positive signal.

It tells us that confidence in the retail sector is coming back. Tenants are actively looking for space and they’re signing leases. I mean, that is. Fantastic news for the DFW retail market, increased leasing activity. It means businesses want to be here. They want to set up shop. They want to grow. And that translates into more investment opportunities, potentially higher property values.

It’s a good sign. And, you know, the report also mentions an uptick in us investor interest in office properties. Yeah, they did. However, you know, office it’s a bit more complicated, it’s more nuanced. It really depends as a specific market. And the class of property you’re looking at. True. It’s something we’re keeping a close eye on here at Eureka Business Group and DFW.

Yeah, makes sense. Now for Europe, residential. Residential is actually the top dog now. It’s overtaken industrial and logistics, reflecting their own unique market dynamics. And in Asia Pacific, well, industrial logistics still reign supreme. But there’s a growing appetite for multifamily. It’s on the rise.

So we see these global preferences and they give us this broader context. But for our listeners here in DFW, the key takeaway is this. The U. S. market, and potentially our local area, is witnessing a resurgence of interest in retail from investors. So let’s talk about some of the differences, the divergent views that the report highlighted, especially when it comes to the office sector.

Yeah, there’s a definite contrast in how investors are viewing office. You know, U. S. investors are a bit less enthusiastic compared to their counterparts in Europe and Asia Pacific, and this likely stems from those high office vacancy rates that we’ve been seeing. Yeah. It’s definitely a trend we’re tracking closely here in DFW.

Makes sense. Now, European investors, when they are considering office, they’re laser focused, on prime. High quality properties, it’s all about quality over quantity, it seems. And in Asia Pacific, well, even though some areas have high vacancy, investment in office It’s actually picking up. Why? Well, a few factors are at play.

More people returning to the office, steady leasing demand in certain segments, and some price adjustments. Really highlights how crucial it is to understand those local market nuances, even when we’re analyzing global trends, right? Now, let’s touch on alternatives, alternative investments. The report had some interesting insights there.

It did. And what’s interesting is there wasn’t this clear consensus on the most sought after alternative sectors. It really varied by region. U. S. investors, they’re still showing love for niche areas like self storage and industrial outdoor storage, which weren’t really top picks elsewhere. What’s even more interesting is over half Over half of U.

S. investors said, nope, not interested in alternatives this year. So maybe there’s this refocusing happening back to the core asset classes, like you guessed it, retail. It’s a really intriguing point. Maybe a shift back to the familiar, the core sectors in the U. S., so Europe and Asia Pacific. What about their alternative preferences?

Well, European investors, they’re really into data centers. No AI boom happening. And also student living. Makes sense. And Asia Pacific, similar story, data centers are hot and health care related assets are getting a lot of attention, reflecting the growth of the digital economy and demographic shifts in those regions.

So diverse landscape for alternative investments, but with a potential refocus on core sectors. Like retail in the U. S. So let’s talk rivers and challenges. What are investors keeping an eye on? What are they worried about? Well, for U. S. investors, the big elephant in the room is interest rates. Long term interest rates.

They’re high. They’re volatile. And that creates a lot of uncertainty, especially when it comes to financing commercial real estate deals. Definitely something we’re monitoring closely here at Eureka Business Group. Financing is a critical part of the equation. So Europe and Asia Pacific, what are their main concerns?

They’re more worried about geopolitical risks. Understandably so. Given what’s happening in the world, but the report also it mentioned some other potential challenges things that could impact investment activity across all regions like mismatches in pricing expectations between buyers and sellers Operating expenses are going up labor and construction costs are rising and then there’s that lingering uncertainty About interest rates and the possibility of an economic slowdown A lot to think about for anyone’s considering an investment.

So let’s tie it all together. What’s the overall market outlook according to CBRE? And what does it all mean for our DFW retail market? Well, CBRE, they’re predicting a continued recovery for U. S. investment sales volume in 2025. They’re projecting an 8 percent increase, and they emphasize that it’s the strong U.

S. economy, especially job growth. That’s driving these positive real estate fundamentals. And this is particularly relevant for DFW. Our economy is robust. It’s attracting businesses. It’s attracting people. No doubt about it. DFW’s economic and job growth has been a huge factor in the success of our commercial real estate market.

Exactly. Now the report also forecasts growth in investment activity in Europe. They’re looking at 15, 20 percent and Asia Pacific. So it’s important to keep that global context in mind. And I love this quote from Kevin Ossoff. He’s the America’s president of investment properties at CBRE. He said capital continues to gravitate towards real estate investment in the U.

S. Despite higher for longer interest rates, we see signs of a healthy economy, supporting improved real estate fundamentals with more bidder activity every month. So even with the interest rate concerns. There’s this positive momentum. Yeah, I mean, that quote really sums it up. It’s encouraging. And what about those value add strategies?

How do they tie into the DFW retail landscape? What are the opportunities there? Well, it tells me that there’s going to be this continued interest in acquiring and redeveloping retail spaces here in DFW. It’s about meeting the needs and preferences of today’s consumers. Investors will be looking for properties where they can make strategic improvements, reposition them and unlock that hidden value.

Right. And let’s not forget that key finding from the report, the uptick in investor interest, specifically in U. S. retail, fueled by that increased leasing activity. I mean, that’s a pretty clear positive sign for the DFW retail market, wouldn’t we say? Absolutely. I’d say so. When we look at these global trends and combine them with the U.

S. specific data, it paints a very optimistic picture for strategic investment in DFW commercial real estate. You know, it’s amazing how these global trends connect to our local market. So, let’s recap. We took a deep dive into this CBRE report. And despite some caution, due to those interest rate uncertainties, the overall sentiment among global investors that it’s commercial real estate is largely positive.

And for our listeners, here in Dallas Fort Worth, the key takeaway is this, there’s a renewed interest in the U. S. retail sector. And that has a direct impact on our local market. Positive impact. Yeah, I think that’s a great summary. The current environment, it really does present some unique benefits for those looking to invest in commercial real estate.

Especially when you consider the potential for more favorable pricing on acquisitions, the attractive opportunities that come with those value add strategies, and that encouraging uptick. In leasing activity, in the retail sector, it’s all pointing in the right direction. And that’s where Eureka Business Group comes in.

We’re here to help you navigate the Dallas Fort Worth commercial real estate market with our specialized focus on retail. So if you’re ready to explore these opportunities and leverage our expertise, don’t hesitate to reach out. We’d love to hear from you. You know, based on, I think we’ve discussed today, these global investor trends, the resurgence of interest in U.

S. retail, I really believe. That the Dallas Fort Worth commercial real estate market, especially the retail segment, it holds tremendous potential for those who are ready to make strategic investments. It’s an exciting time to be in DFW real estate. So here’s a final thought for you. As you go about your day, consider this with global investors signaling continued activity and the U.

S. retail sector regaining strength. What unique opportunities might be emerging right now within the Dallas Fort Worth landscape? For those who are ready to seize the moment, that’s something to ponder. And with that, thank you for joining us for this commercial real estate briefing. Brought to you by Eureka Business Group.