July 2025

North America

·SL Green Realty rides NYC office comeback as tech deals drive leasing momentum. SL Green Realty is capitalizing on New York’s office market recovery, reporting strong Q2 leasing activity and surpassing its $1B fundraising goal for its NYC-focused debt fund. With 1.26 million sq ft already leased and another 1 million sq ft in the pipeline, the REIT is on track to exceed its 2 million sq ft leasing target for 2025. Tech firms are playing a central role in the rebound, including a 64,000 sq ft lease with Sigma Computing at One Madison, now 78.1% leased. CEO Marc Holliday highlighted robust demand from small and midsized tenants across sectors, with a notable return of TAMI (tech, advertising, media, and information) occupiers and leasing spreading beyond Park Avenue. Leasing diversity and diminishing office supply—driven by conversions and a lack of new builds—are strengthening the market. SL Green expects Manhattan occupancy to reach 93.2% by year-end, with tech demand seen as a “game changer” versus last year. While political uncertainty from the mayoral race looms, Holliday emphasized SL Green's resilience across administrations and voiced continued support for a pro-business leadership stance. (Source: SL Green Realty, CoStar, 2025)

SL Green Realty’s redeveloped One Madison Tower, Manhattan

·Starwood tests major Net-Lease play with $2.2B Brookfield platform buy. Starwood Property Trust is making its biggest diversification move yet, acquiring Brookfield’s Fundamental Income Properties for $2.2B as it pushes deeper into net-lease real estate and away from a reliance on commercial lending. The Phoenix-based platform owns 467 fully leased single-tenant assets across 44 U.S. states with a 17-year WAULT, 2.2% average rent bumps, and 100% occupancy, providing Starwood a long-income foundation as it targets the fragmented $trillion-scale market. The acquisition mirrors a broader institutional pivot into net-lease, seen in BlackRock’s recent purchase of ElmTree Funds, as investors seek stable, inflation-linked income streams amid volatility in traditional real estate sectors. Starwood Chairman Barry Sternlicht said the platform’s scale and infrastructure give the company a powerful base for growth, while President Jeffrey DiModica emphasized the transaction’s earnings accretive and “safety-first” profile. Fundamental’s 28-person team will join Starwood, with the deal expected to close this month. BofA advised Starwood, while Wells Fargo and Evercore advised Brookfield, which continues to recycle capital into higher-return strategies. (Source: Starwood, CoStar, 2025)

Property in Fredonia, Wisconsin, is part of the portfolio under Fundamental Income Properties

·Manhattan office recovery spreads beyond Midtown as vacancy drops across the board. In a surprising turn, all three of Manhattan’s major office markets — Midtown, Midtown South, and Downtown — have seen notable drops in availability, as tenant demand rebounds and landlords pursue conversions and alternative uses. Midtown South led the charge, posting the steepest decline in available space over the past year — from 20.2% to 16.1%, a 410-basis-point drop. Downtown followed with a 250-point fall to 16.2%, while Midtown’s availability slid from 17% to 14.6%, the smallest drop despite hosting most of 2025’s leasing activity. The trend reflects a mix of renewed tenant appetite, broader search parameters, and shrinking supply due to repurposing — particularly downtown, where more buildings are being repositioned or withdrawn from the market. Midtown’s tighter supply story began earlier, with availability falling steadily since 2022. In contrast, Midtown South and Downtown peaked in 2024, giving them more headroom for improvement. Even Class B space is now in decline, signaling a broad-based resurgence in New York’s office market. The takeaway? Tenant demand is returning across all locations and asset types — not just the trophy towers. (Source: CoStar, 2025)

Basis points change in Manhattan office availability over the previous 12 months

·Colliers consolidates investment management businesses under Harrison Street brand as $100B platform emerges. Colliers has rebranded and reorganized its global investment management division under the Harrison Street Asset Management name, creating a $100 billion AUM platform. The consolidation brings together Colliers-controlled firms — including Basalt Infrastructure, Versus Capital, Rockwood Capital, and Colliers Global Investors — under the leadership of Harrison Street co-founder Christopher Merrill, who becomes global CEO and its largest shareholder. This strategic move reflects Colliers’ focus on scaling recurring revenue streams beyond traditional brokerage. Harrison Street, a leader in alternative investments across student housing, life sciences, and data centers, aims to become a premier global platform offering infrastructure, real estate, and credit strategies. The restructuring follows Colliers’ 75% stake acquisition in Harrison Street in 2018 and comes as its investment management revenues hit $126.2 million in Q1, up 3% year-on-year. Colliers reported a 16% revenue boost overall in May, driven by engineering and non-brokerage services. Harrison Street is also relocating its HQ to a new building in Chicago’s Fulton Market, underscoring its growth trajectory. (Source: Colliers, Harrison Street, CoStar, 2025)

Harrison Street Asset Management is headquartered at 444 W. Lake St. in Chicago

·Blackstone taps $7.2B in fresh capital in Q2 2025 as large-ticket appetite returns and recovery accelerates. Blackstone, the world’s largest commercial real estate owner, raised $7.2 billion in new capital in Q2 — up $1 billion from the prior quarter — as investor appetite begins to return, particularly for logistics, real estate credit, and stable income strategies. The private equity giant sees a real estate recovery gaining traction, driven by sharply reduced new construction in core sectors like logistics and multifamily, creating a more favorable supply-demand balance. President Jon Gray said the dealmaking pause is over and expects interest rate cuts by the Federal Reserve to further ease capital costs, improving transaction volumes and asset pricing. Recovery will be led by high-conviction sectors where fundamentals remain strong — logistics, data centers, life sciences, and single-family rental — while capital scarcity continues to sideline over-leveraged or obsolete assets. New capital includes $2.4 billion into real estate debt strategies, $1.1 billion into the flagship BREIT, and $1 billion earmarked for U.S. logistics. Opportunistic real estate strategies posted marginal gains of +0.1% in Q2, reversing four quarters of negative returns. With inflation trending below the Fed’s target, executives expect further policy support to boost asset values. (Sources: Blackstone, CoStar, 2025)

Europe

·Private credit raises £21B in H1 2025 as non-bank lenders step in. Private credit funds raised £21 billion for commercial real estate in the first half of 2025, nearly matching the £22.4 billion annual average seen in recent years. This surge reflects a broader shift as traditional banks pull back from property lending due to regulatory and balance sheet pressures. In Europe, where banks dominate the lending landscape, their retreat has opened up significant opportunities for alternative lenders. Moody’s projects that up to $1 trillion in commercial real estate debt could transition to private credit over the next 3–5 years. However, growing risk accompanies this expansion, with loan-to-value ratios rising to 74%, well above banks’ original appraisal levels. The IMF warns that slowing global growth could strain borrowers' repayment capacity, posing risks to both private credit funds and their institutional partners. Despite reducing direct exposure, traditional lenders remain linked to riskier real estate assets via feeder funds, JVs, and warehouse lines. (Source: Moody’s Investors Service, Ares Real Estate, CoStar, IMF, 2025)

·One of Europe’s largest core office sales of 2025 launched to market as €900M Opernturm tests investor appetite in Frankfurt. GIC and JP Morgan have launched the €900 million sale of Frankfurt’s iconic Opernturm, marking the largest core office disposal in Europe this year. With BNP Paribas Real Estate and Eastdil Secured appointed to run the bidding process in late August, the sale will test global appetite for prime offices amid a cautious investment climate. The 67,200 sq m property produces €41.5 million in annual income, offering a 4.5% net initial yield, and is anchored by major tenants including UBS and KPMG, with a WAULT of more than nine years. Originally acquired in 2011 for €550 million, the tower has since seen a strong leasing track record and sits prominently on Frankfurt’s Opernplatz. The sale comes as the joint venture’s holding period concludes and unsolicited buyer interest increases, positioning Opernturm as a bellwether for renewed institutional confidence. The launch coincides with a soft office market in Frankfurt, where just six deals closed in H1 2025, yet investors believe this asset’s location, tenant profile, and lease term could draw both single buyers and joint ventures. (Source: BNP Paribas, Estadil Secured, Green Street, 2025)

Opernturm, Frankfurt, launched to market by GIC and JP Morgan

·Invesco tests Paris core market with €1B Capital 8 Sale, largest office listing in Paris. Invesco Real Estate has brought its flagship Paris office asset, Capital 8, to market in a landmark sale set to test institutional demand for prime French offices. Valued at approximately €1 billion and reflecting a 4.5% yield, the recently renovated 45,000 sq m complex near Parc Monceau is the largest office asset currently for sale in Paris. CBRE has been appointed to lead the process, coming as investor sentiment rebounds following major Paris CBD transactions like the €700 million CityQuartier Trocadéro deal. Invesco invested €100 million in refurbishments, with 60% of space pre-let during the process, enhancing its appeal amid tightening vacancy and rising rents in the Paris core. This marks a strategic moment for Invesco, which acquired the property from Unibail in 2018 for €789 million as part of its European flagship strategy. The sale further signals that large-ticket office sales are returning to the French capital, with additional major assets, such as 29-33 Champs Elysées and Odeon, also hitting the market this year. (Source: CBRE, Green Street, 2025)

Invesco puts Capital 8, Paris, on the market

·EMEA data center capacity surges past 24 GW as investors target AI-driven growth. Cushman & Wakefield’s latest report shows that EMEA data center capacity will exceed 24.4 GW, with operational supply growing 21% year-on-year and the development pipeline expanding by 43%. The FLAPD markets—Frankfurt, London, Amsterdam, Paris, and Dublin—plus Milan, remain dominant, accounting for nearly half of all capacity and future development. London leads with 1,189 MW operational and 1,678 MW planned, while Paris gains momentum with 906 MW in development, backed by France’s push to become a European AI leader and €70 billion in pledged investments. Sustainability, land constraints, and energy security are shaping market dynamics, but investor appetite remains strong across both established hubs and emerging cities such as Oslo, Lisbon, and Riyadh. Cushman’s new EMEA Data Center Maturity Index classifies 31 markets, with Lisbon, Stockholm, Lagos, and Athens rising in rank due to large-scale projects and digital infrastructure reforms. The rise of AI, hyperscale demand, and regional diversification are creating “the next wave” of investment, with second-tier cities offering strategic scale and sustainability advantages, according to C&W’s Andrew Fray. (Source: Cushman & Wakefield, Business Immo, 2025)

The FLAPD markets of Frankfurt, London, Amsterdam, Paris and Dublin, in addition to Milan continue to dominate the EMEA data centre market.

·Core appetite returns as logistics leads Europe’s tentative recovery amid geopolitical risks. European real estate is showing early signs of recovery, with capital values up 2% from the trough, but geopolitical tensions continue to weigh on investor confidence, Aberdeen's Q3 2025 report warns. Logistics is forecast to be the top-performing sector over the next three years, driven by strong fundamentals, rental growth exceeding inflation, and robust leasing demand. Markets such as the UK, Netherlands, France, Southern Europe and the Nordics are expected to outperform, supported by low supply, easing inflation, and rate cuts. However, uncertainty around US tariffs and global policy responses is overshadowing the recovery, said Aberdeen's Anne Breen. Residential and logistics remain key focus areas, while the office outlook is mixed, with demand strongest for high-quality space in core locations like Paris CBD and London. Meanwhile, PGIM Real Estate plans to ramp up investment in H2 2025, citing a “generational” opportunity amid capital flows shifting from the US to Europe and Asia. State-led investment and real estate credit are also seen as critical drivers of the next cycle. (Source: Aberdeen, PGIM, Green Street, 2025)