Investors Eye These Cities for Prime CRE Opportunities in 2025
CBRE's 2025 U.S. Investor Intentions Survey reveals a robust outlook for CRE investment, with 70% of buyers planning to increase their asset acquisitions this year compared to 2024, while slightly less than half anticipate selling more properties.
The survey also sheds light on where these investors are focusing their attention.
Specifically, CBRE reports that investors are targeting markets including Dallas, Miami, Boston, New York City, Atlanta, Austin, Raleigh-Durham, San Francisco, Washington, D.C., and Phoenix for potential activity this year.
The top-ranked market for attractiveness was Dallas for the third year. The second was Miami. One shift was third place — Boston has replaced Raleigh-Durham this year. Gateway markets are also back in vogue. Boston only re-entered the top 10 this year, with San Francisco (nine) and Washington, D.C. (eight) also making return appearances. New York City was number five, up from seven last year.
The other top 10 entries this year were Atlanta (four), Raleigh-Durham (six), Austin (seven), and Phoenix (10).
The Sun Belt was dominant among secondary markets for its growth prospects, but it appears investors are taking a closer look at gateway markets because there are opportunities at a discount.
Almost two-thirds of investors choose value-add and core-plus as their preferred strategies. Opportunistic, core, distressed, and debt strategies declined from last year — an interesting development given how strongly many companies, individuals, and funds had been waiting for bargains that haven’t appeared, at least not at the expected volume.
The biggest preference is multifamily, with 72% of investors looking for them. That compares to 75% last year and 66% in 2023.
The next most popular asset type is industrial and logistics, with 37% of investors looking for them. It’s a sharp drop from 2023 when half were interested, and 40% were looking for them in 2024.
Retail came in third and has been growing for several years: 17% in 2023, 22% in 2024, and 27% in 2025. Hotels have been taking a slide from 23% in 2023 to 18% in 2024 and 14% in 2025. Office had ups and downs, dropping from 20% in 2023 to 10% in 2024 but then up to 13% in 2025.
Data centers seemed to come out of nowhere, with next to no activity in either 2023 or 2024 but suddenly jumping to 10% this year.
The two biggest challenges for investors are where interest rates will wind up and the impact of higher expenses, caused by the uncertainty. Almost 70% of investors plan to maintain their debt-to-equity ratios from 2024; 56% say they would tolerate up to a year of negative leverage. Also, investors are most focused on mortgage and mezzanine financing and distressed debt, although less than last year.
Source: GlobeSt/ALM