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Good morning. The net lease market showed steady footing in Q3, with cap rates holding firm and investors staying active despite a shifting rate environment. Stability, it seems, is the new strength.

Today’s issue is brought to you by Avalon Risk Management—protect your property, cuts risks, and maximizes ROI.

🎙️This week on No Cap: Fundrise CEO Ben Miller explains how his $7B platform is using data, AI, and creative financing to open new doors for everyday investors.

Market Snapshot

*Data as of 10/09/2025 market close.

Steady Signals

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• Redefining CRE bridge lending: Get term sheets in under 24 hours and funding in as little as 3 days. Atlas Invest empowers investors, brokers, and developers to get funded faster than ever. (sponsored)

• Yield bump: Five U.S. REITs raised dividends in September, pushing 2025's total to 58 amid sector-wide payout growth.

• Forecast reset: Fed rate cuts and economic uncertainty push 2026 rent growth forecasts below 2%, with Denver leading expected declines. 

• Island upset: Fisher Island, FL claimed the title of the most expensive U.S. zip code in 2025 with a $9.5M median sale price.

• Leaseback limits: A new Senate bill targets "predatory" sale-leaseback deals with REITs after Steward Health's collapse exposed financial risks to hospitals and public health. 

• Stress relief: CRE CLO distress rates fell 180 basis points in September to 11.5%, signaling improved loan performance amid a still-maturing and risk-heavy portfolio. 

• Rebuild risk: LA faces up to $100M in annual property tax losses from January's wildfires, but rising property values could help offset the fiscal blow.

• Boomer bet: Clarion Partners plans to invest up to $1B annually in top-tier senior housing, joining a wave of private capital chasing demand from aging baby boomers. 

• New normal: Multifamily investors face growing uncertainty as cap rate spreads widen across markets, driven by local fundamentals, debt pressures, and operator strategies.

• Back in demand: Investor interest is surging in San Francisco's multifamily market as AI-fueled demand and low housing supply drive rent growth and bidding wars for top assets.

• Tampa buy: Cantor Fitzgerald paid $100.4M for a 351-unit Tampa community, reaffirming investor appetite for Florida multifamily.

• AI or bust: Without massive investment in data centers and AI infrastructure, U.S. GDP growth in early 2025 would have flatlined at just 0.1%.  

• Sunbelt storage: Harrison Street and Morningstar acquired a 1.3M SF self-storage portfolio across the Sunbelt, betting big on high-growth markets. 

• Jersey jackpot: Terreno Realty sold a fully leased New Jersey warehouse for $144M—netting a 13.4% unleveraged return after acquiring the site for just $22.5M in 2010. 

• Doral goes industrial: Hamilton Development is converting distressed suburban Miami offices into 300K SF of industrial space, betting on logistics demand amid a softening office market.

• Retail scale: Crow Holdings Capital recapitalized a 194-property, 4.5M SF national retail portfolio, doubling down on small-format, necessity-based shopping centers.

• Northern migration: Publix has signed a 50K SF lease at Ashland Square in Manassas, VA, marking its northernmost location as the Florida grocer expands deeper into the Mid-Atlantic. 

• Buyer freeze: The government shutdown is intensifying financial uncertainty, prompting many Americans to delay major purchases like homes and cars.

• Southwest strategy: Dollar Tree will open a 1.25M SF Arizona distribution center by 2026 to support its growing store network across five Southwestern states.

• Office orders: Major firms like Ford, Microsoft, and Google are tightening return-to-office policies, using stricter rules and even disciplinary threats to bring employees back. 

• Auction alert: Boston's historic Bedford Building, last sold for $50M, is set for auction on Nov. 5 amid growing distress in the city's office market.

• Chicago crackdown: The Department of Homeland Security plans to acquire more buildings in Chicago for ICE operations. 

• Government guarantee: NGP Group secured a three-year extension on a $660M CMBS loan for a nationwide office and industrial portfolio leased to U.S. government agencies. 

• Rescue capital: Rialto Capital seized a distressed Rosemont office building from Adventus Realty via a deed-in-lieu, amid a broader $350M CMBS portfolio collapse.

• Portfolio exit: Magna Hospitality sold four Midtown Manhattan hotels to institutional investors for $489M.

• Hilton hub: Hilton and the Savannah-Georgia Convention Center Authority broke ground on a $398M, 444-room Signia by Hilton hotel, set to open in 2028.

📈 CHART OF THE DAY