SVN® International Corp. Economic Update – Keeping our clients up-to-date about the latest real estate landscape trends.
SVN’s February 13, 2025 Economic Update points to a resilient but uneven economy. January payrolls increased by 130,000, well above expectations, and the unemployment rate fell to 4.3%, reinforcing the strength of the labor market and reducing the likelihood of a near-term Fed rate cut. Logistics activity accelerated to its highest level in seven months as inventories were restocked and transportation capacity tightened. At the same time, job openings declined to their lowest level since 2020, retail sales were flat in December, and small business owners reported elevated uncertainty despite optimism remaining slightly above historical averages.
Commercial real estate conditions continue to diverge across sectors. CMBS delinquencies rose to 7.47%, driven primarily by record-high office delinquencies, while retail and multifamily also experienced increases. In contrast, lodging and industrial performance improved. National foreclosure filings climbed year over year but remain below historical peaks. Office demand posted modest annual gains in 2025, supported by tech-driven markets, though overall activity remains below pre-pandemic levels. Meanwhile, a sharp slowdown in net international migration is cooling the national demand backdrop, with population growth increasingly concentrated in smaller and mid-sized states.
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