The month of October interrupted a trend in the recovery of commercial real estate that has been slow and bumpy — much like interest rate policy over the past few years, CNBC reported.
The network said the two are connected.
This year has proven to be rough after gaining momentum coming out of the pandemic.
According to monthly data provided by Moody’s as a media exclusive to CNBC’s Property Plan, October was the first month of negative year-over-year transaction volume growth since the post-Fed rate hike recovery began in early 2024. Property Play tracks the top 50 CRE property sales across the nation.
CNBC noted that deal volume growth turned positive in the early part of last year. It approached pre-Covid levels by year-end.
Despite Slip, October Was a Busy Month
“More than an imminent downturn in the CRE capital markets, the slip to negative growth in October 2025 reflects the stalemate going on between buyers and sellers,” Kevin Fagan, head of CRE capital market research at Moody’s, told CNBC. “The bottom of the U-shaped recovery from 2023 low volumes has been lengthened by persistently high interest rates and policy and economic uncertainty of 2025.”
October was still an active month, the report noted.
There were $24.4 billion of sales, or roughly 70% of October 2019 sales. Total dollar volume was higher this year than it was last year, but Moody’s said the momentum of growth has slowed significantly since 2023.
Industrial and multifamily led the top 50 deals, the report said. The only sector to improve in deal volume compared with last year was hotel, Moody’s said. It recorded 6% growth after a negative third quarter.
The report mentioned one notable sale: The New York Edition hotel at 5 Madison Avenue was sold for $231.2 million to the Kam Sang Co., a real estate development firm, by the Abu Dhabi Investment Authority, a sovereign wealth fund.
“The New York Edition hotel is an interesting one because of both the sales price being so high, a Mideast sovereign wealth fund pulling out of NYC, and the history of the building,” Fagan said. Originally it was an office building called the MetLife Clock Tower and was the tallest building in the world for roughly three years from 1910 to 1913.
Both the Clock Tower and the Woolworth building, which also once was the tallest in the world, were converted to hotel and residential, respectively, starting around 2013, CNBC said.
The multifamily segment saw the biggest pullback in October, down 27% from 2024, the report said. CNBC said it had been showing higher volumes than pre-Covid levels in the four months before, and, despite the pullback, buildings were mostly trading at a premium to previous sales.
Office continued its rocky recovery, with either discounts or property conversions as part of the story. The report said that the top October sale was of the Sotheby’s headquarters to Weill Cornell.
