April 2025

North America

·Tishman Speyer in talks to acquire first Manhattan office buy since 2019 with $120m Soho deal. Tishman Speyer is in talks to acquire the 150,000 sq ft office building at 148 Lafayette Street in Manhattan’s Soho for roughly $120m, or around $800/sq ft. The property is being sold by EPIC, which paid $126.5m in 2012, and recently signed General Catalyst to over 42,000 sq ft of space. The deal would mark Tishman’s first Manhattan office acquisition since 2019 and follows several years focused on other markets and developing the 2.8m sq ft Spiral near Hudson Yards. This potential acquisition comes amid renewed institutional interest in Midtown South, with recent deals from Blackstone and SL Green pointing to cautious optimism. While the current yield has not been disclosed, the pricing reflects a modest discount to the prior sale, suggesting Tishman sees value amid a stabilizing leasing environment. A Newmark team led by Adam Spies and Adam Doneger is marketing the property, with the deal yet to be finalized. If completed, the transaction would underscore growing confidence in well-located, creatively tenanted office assets in Manhattan’s evolving post-Covid market. (Source: Commercial Observer, The Real Deal, Commercial Real Estate Direct, 2025)

148 Lafayette Street, Soho, New York

·D.C. office trades at 52% discount as US office valuations reset. In a sign of the ongoing recalibration in the U.S. office market, a recently renovated office building in Washington, D.C.’s Dupont Circle has traded for roughly half its prior value. Miami-based Azora Exan acquired the 78,399-square-foot property at 1666 Connecticut Ave. NW for $15.75 million, reflecting a 52% drop from its last sale price of $30.5 million in 2019. The building, which was renovated in 2021, is currently 28.9% vacant — more than twice the Class B average for the D.C. market. The seller, ASB Real Estate Investments, opted to exit amid persistent pricing pressure across the national office sector, where valuations for older and less-leased buildings continue to fall sharply. At $201 per square foot, the transaction represents a significant reset in capital values for central D.C. office stock. Based on in-place income, the sale implies a cap rate in the range of 7–8%, according to sources familiar with the deal, aligning with pricing seen in other recent distressed or vacancy-challenged assets. This transaction is one of several across major U.S. markets highlighting the stark repricing underway. Institutional capital remains largely sidelined due to limited financing availability and uncertain demand recovery, creating space for private investors and family offices to re-enter the market at opportunistic levels. While the national vacancy rate hovers near record highs — with D.C. Class B vacancies above 14% — buyers like Azora Exan are betting that strategic locations and upgraded assets can stabilize and offer long-term value at steeply discounted basis levels. (Source: CoStar, 2025)

Property	Market	Latest Sale Price	Previous Sale Price	% Decline
1666 Connecticut Ave. NW	Washington, DC	$15.75M (2025)	$30.5M (2019)	-52%
Lincoln Crossing	Denver	$10.0M (2025)	$95.25M (2018)	-90%
1401 H St. NW	Washington, DC	$118.0M (2025)	$208.0M (2006)	-43%
45 Milk Street	Boston	~$450M (2025 est.)	~$900M (2006)	-50% est.

1401 H St. NW in Washington, D.C.

·Korean lenders seize 285 Madison Avenue in Midtown Manhattan via foreclosure against previous owner RFR Realty. A consortium of Korean institutional lenders has taken control of 285 Madison Avenue in Midtown Manhattan through a UCC (Uniform Commercial Code) foreclosure, after former owner RFR Realty defaulted twice on mezzanine debt. The property, located just blocks from Grand Central, had undergone over $80 million in upgrades and remains nearly fully leased with Tommy Hilfiger as anchor tenant. RFR, which purchased the building for $190 million in 2012, declined to bid at auction following a sharp valuation drop from $610 million in 2017 to $300 million in 2024. Korean advisory firm Daol Asset Management, which held $200 million in mezzanine debt, executed the foreclosure swiftly, bypassing slower judicial proceedings and beating out CMBS bondholders also seeking control. The new owners believe the asset’s prime location and improved leasing environment present a strong value-creation opportunity. This marks a more assertive stance by Korean investors as they seek to protect and reposition assets in high-quality U.S. markets. (Source: Yahoo Finance, CoStar, The Real Deal, 2025)

Korean lenders take control of 285 Madison Ave. in Manhattan through a foreclosure auction.

·Office CMBS delinquencies continue to surge as buyer of retail assets step in; San Francisco hotels struggle. Office loan delinquencies tied to CMBS have jumped to 12.73%, the highest level since the pandemic, adding nearly $940 million in defaulted debt, according to Moody’s. A weakening refinancing market has left many borrowers unable to repay at maturity — with just 61% of maturing office loans paid off in Q1, down from 70% in Q4. Over 127 million square feet of office space is now tied to delinquent loans, with central business districts showing a staggering 32.6% vacancy rate. In San Francisco, two long-delinquent Hilton hotels backing a $725 million CMBS loan are under contract, though the loan has been downgraded as a loss is expected on a $240 million loan portion. Meanwhile, retail shows signs of resilience: Lamar Cos. and First National Realty acquired troubled shopping centers in North Carolina and Missouri, respectively, as receivership sales pick up. While office pain deepens, opportunistic buyers are capitalizing on distressed retail assets. (Source: Morningstar DBRS, CoStar, 2025)

US CBD office properties backing delinquent or defaulted CMBS loans have an average c. 33% vacancy rate.

·Prologis cautious on outlook as tariffs disrupt warehouse demand. Prologis, the world’s largest industrial property owner, reported a strong 9.5% revenue gain to $2.14 billion in Q1, driven by 58 million square feet of leases and growth in its data center and solar arms. However, the company dialed back its forward-looking optimism after President Trump’s sweeping April 2 tariff announcement triggered financial market volatility and stalled warehouse leasing activity by nearly 20%. CFO Tim Arndt warned that supply chain uncertainty and shifting trade policies are causing tenants to delay space commitments, clouding the company's ability to upgrade guidance. Despite this, leasing activity hasn’t fully collapsed — Prologis signed over 6 million square feet of new deals in early April and sees demand for overflow space from logistics clients. Executives highlighted the potential for increased warehouse demand in a fragmented trade environment, even as recession and inflation risks loom. Meanwhile, Blackstone echoed a more opportunistic stance, calling current volatility a buying window amid long-term undersupply in logistics and digital infrastructure. (Source: Prologis, Blackstone, CoStar, 2025)

Prologis HQ on Pier 1 in San Francisco

Europe

·Japanese capital returns to London with strategic focus on offices, living, and logistics. Japanese investors are returning to London real estate as investors seek higher yields abroad, driven by a near-zero interest rate environment at home, a weakening yen, and long-term pressures from Japan’s shrinking population. This wave is more strategic than the 1980s, with investors focusing on diversification, long-term growth, and development opportunities in mature global markets. Recent activity includes Sotetsu Urban Creates and Yasuda Real Estate acquiring a 20% stake in Deutsche Bank’s HQ at 21 Moorfields, Nomura Real Estate partnering with L&G to build 1,000 BTR homes, and Mitsubishi Estates investing in logistics alongside Evo Lake. Mitsui Fudosan has forward-funded a £135m Panattoni logistics scheme and is co-funding a £1.1bn British Library expansion, while Daibiru Corporation is acquiring Capital House on King William Street and assets in Sydney. These moves reflect a focus on high-quality assets in key urban locations, often alongside trusted UK and global partners. Knight Frank estimates more than £1.5bn in Japanese capital is allocated for London offices alone, with interest also growing in residential, logistics, and data centres. With fewer competing bidders and a cyclical low in valuations, Japanese groups see this as an opportune time to deploy capital into future-proofed assets. (Source: Green Street, Knight Frank, 2025)

Sotetsu Urban Creates and Yasuda Real Estate buys into 21 Moorfields, City of London

·Ares deepens London office bet with additional £100m West End acquisition, with many US investors following. Ares Management has agreed to acquire 101 New Cavendish Street in London’s West End for just under £100m, continuing its aggressive expansion in the capital’s office market. The 101,000 sq ft freehold block is fully let to ten tenants at an average rent of £65.15/sq ft, with a WAULT of just under six years to expiry. Sold by Welput, the BentallGreenOak-managed fund, the building was originally marketed for £116m, reflecting a circa 5.95% yield and a notable discount to guide. This deal follows a string of recent acquisitions by Ares, including 45 Pall Mall (£135m), a mixed-use portfolio on St John’s Wood High Street (£70m), and Oxbourne House on Oxford Street (c.£40m). The US investor also bought a £210m property book from St James’s Place and is currently bidding on Zara’s flagship store at 61 Oxford Street. With capital to deploy and appetite for discounted core-plus assets, Ares is strategically capitalising on valuation resets across London’s office market. The firm’s activity signals growing conviction in the long-term fundamentals of prime central London, especially as leasing resilience continues to underpin income stability. (Source: Green Street, 2025)

Ares acquires 101 New Cavendish Street

·UK and Spain take top target for residential sector investments, followed by Germany. The UK and Spain have overtaken Germany as the top destinations for investors targeting Europe’s living sector over the next five years, according to Cushman & Wakefield’s 2025 European Living Investor Survey. Of the €1.4tr in global real estate assets represented in the survey, 80% of respondents plan to increase allocations to the sector, signalling strong investor conviction. Purpose-built student accommodation (PBSA) is the most sought-after segment near term, cited by 75% of respondents, driven by rental outperformance and lighter regulation. The private rented sector (PRS) remains the second priority but saw a sharp decline in expected allocations, falling from 90% to 73%, amid continued planning and regulatory headwinds in markets like the UK. Co-living saw the biggest year-on-year rise in investor interest, with 44% expecting to deploy capital in the sector by 2028, up from 33% today. The shift toward forward commitment structures, now preferred by 29% of investors, highlights growing appetite for earlier-stage deployment to access pipeline opportunities. While pricing mismatches and political risk remain challenges, the overall outlook is bullish, with major investors positioning for a new expansion phase across Europe's most liquid living markets. (Source: Cushman & Wakefield, Green Street, 2025)

Madrid Purpose Built Student Accommodation on the top of the list of targets in the living sector

·Tariffs drive shift in global investment focus towards European real estate, according to Pictet and Aware Super, Australia’s third-largest superannuation fund. Pictet's global head of real estate, Zsolt Kohalmi, recently highlighted how the tariffs imposed by the US government are driving a shift in global investment patterns, with many investors turning their focus toward European real estate. Kohalmi explained that the growing uncertainty created by these tariffs is prompting a move towards diversification, with Europe emerging as a strong contender due to its attractive macroeconomic fundamentals, including favorable interest rate cycles and property undersupply. This shift is especially notable as investors who once concentrated heavily on US assets are now seeking alternatives closer to home. According to Kohalmi, while tariffs may bring short-term pain, they could present a mid-to-long-term opportunity for Europe, especially in sectors like logistics, where local production may see a resurgence. Aware Super, Australia’s third largest superannuation fund, has already made significant strides in Europe, with a £5.25bn commitment and recent investments in UK, Spanish, and Dutch real estate markets. The fund's European strategy, led from its London office, focuses on expanding into sectors such as residential and industrial, while reducing exposure to retail and office assets. Aware Super's experience reflects the broader trend of institutional investors seeking to capitalize on Europe’s relatively strong supply-demand dynamics and market potential. (Source: Green Street, CoStar, Pictet, Aware Super, 2025)

Aware Super acquired 20 Manchester Square, London as part of its London office portfolio aggregation strategy

·German real estate Non-Performing Loans (NPLs) surge 40% amid refinancing gap. The volume of non-performing loans (NPLs) in the German real estate sector has surged by 40.5% to €17.3bn over the past three years, according to new KPMG research. This sharp rise contrasts with a modest 3.6% increase in total commercial real estate loan volume, highlighting a growing issue in the sector. The NPL ratio in real estate reached 5.9% by the end of 2024, a significant increase from just 2.3% in 2021, reflecting the pressure faced by lenders in a challenging market. The primary driver of this NPL growth is a substantial refinancing gap for loans taken out between 2019 and 2021, with many of these loans now coming due. The situation is compounded by regulatory pressures on banks, pushing them to extend loan terms to avoid potential losses, though this has not yet resulted in significant sales of distressed assets. Banks like Aareal, PBB, and Hamburg Commercial Bank are among those with the highest NPL ratios, reflecting the difficulties faced by pure-play real estate lenders. Experts predict that NPL ratios will continue to rise over the next two years, with office real estate likely to bear the brunt as more loans from the boom years mature. (Source: KPMG, Green Street, 2025)

Schloss-Strassen-Center in Berlin was part of an NPL portfolio in Hamburg Commercial Bank’s books