LightBox December CRE Activity Index Declines, Capping a Year of Volatility Amid Long-Term Optimism
IRVINE, Calif., Jan. 13, 2025 /PRNewswire/ -- LightBox, a leading provider of commercial real estate (CRE) information and technology, released its Monthly CRE Activity Index for December, which posted a reading of 56.8, reflecting a 23.7-point month-over-month decline. The Index remained above its levels from the same period in 2023, reflecting resilience in the CRE market despite the typical seasonal downturn.
This aggregate measure of activity in commercial property listings, environmental due diligence, and appraisals collectively tracks shifts in the velocity of key functions that support CRE transactions and therefore provides a useful leading indicator of deal activity.
While seasonal moderation is expected at year-end, this decline was steeper than the average 19.3-point drop seen over the prior three years. Contributing to the decline were rising treasury yields fueled by investor concerns over the federal deficit, the potential for new tariffs, and persistent inflation. The 10-year Treasury yields increased by 40 basis points, from 4.2% at the end of November to nearly 4.6% by year-end.
Shifting to a year-over-year review for broader context, the report commentary highlights the 8.6-point improvement in the CRE Activity Index compared to last December, which was fueled by double-digit increases in the property listings and environmental due diligence components of the Index. This is a notable improvement from year-end 2023 when transactions were thwarted by still-high interest rates, tight debt capital as lenders held fast to the reins of new originations, and sellers were reluctant to list properties given the lack of pricing clarity.
"Heading into January, it's encouraging to witness property listing activity gaining momentum as sellers brought assets to market during the closing weeks of a challenging fourth quarter," said Manus Clancy, LightBox head of Data Strategy. "On the ground, our Market Advisory Councils for capital markets and environmental due diligence are observing increased portfolio activity, growing interest from institutional investors, and renewed engagement from clients who spent much of 2024 in wait-and-see mode."
As anticipated, December's reading remained above the four-year low recorded in December 2023, coming in nearly nine points higher than last year's 48.2. The report highlights that as capital mobilizes to seize opportunities and the market senses a bottom in certain segments, a fear of missing out on bargains is beginning to take hold.
"After more than a year of holding off for interest rates to decline, the market is seeing a resurgence of confidence. Investors with pent-up demand, especially those with their own capital, are pursuing deals reminiscent of those that drove late 2024 transactions. Additionally, the measured return of big banks is anticipated to boost activity across asset types, with multifamily, data centers, and retail showing strong momentum, while some office markets continue to stabilize," said Clancy.
About LightBox
At LightBox, we are at the forefront of delivering advanced and precise solutions for commercial real estate intelligence. Our dedication to innovation propels real estate professionals forward by providing them with the essential tools required to navigate complex decisions, minimize risk, and boost productivity across the spectrum of real estate operations. LightBox is renowned for its commitment to promoting excellence and fostering connections in the industry, serving an extensive clientele of over 30,000 customers. Our diverse client base spans commercial and government sectors, including but not limited to brokers, developers, investors, lenders, insurers, technologists, environmental advisors, appraisers, and other businesses that depend on geospatial information. To discover more about how LightBox can illuminate the path to informed real estate solutions, visit us at: www.LightBoxRE.com
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