The resilience of global economies and generally positive U.S. outlook were two themes that emerged from the January 29, 2026, webinar, “The Year in Review: What’s Past is Prologue. Or Is It?” sponsored by the Counselors of Real Estate, a global invitation-only group of experienced real estate advisors. Jonathan Schein, CEO and founder of Real Estate Limited Partner Institute (RELPI), and Victor Calanog, managing director and global head of research and strategy for Manulife Investment Management, held a free-ranging conversation about commercial real estate and the economy.
“We’re in a period of global anxiety along with resilience,” Calanog said. “The U.S. GDP grew an estimated 4.4% during the third quarter of 2025, which means I estimate GDP growth of 1.8% to 2% overall for the entire year. That’s good news, since earlier in 2025 GDP growth was negative.”
Given the massive size of the $30 trillion U.S. economy, Calanog believes sustainable long-term growth should be about 1.9%.
“An economy of this size can’t grow that much faster than 1.9%, and the estimate for 2025 is well within that range," he said. “Consumer spending is still good, particularly for high income households, and the stock market and equity values are doing well, too.”
Even though the job market is softening, unemployment rates continue to stay under 5%, which so far is another solid indicator, Calanog said.
“In commercial real estate, there was a 30% increase in overall transaction volume in the U.S. in 2025 compared to 2024, according to MCSI,” Calanog said. “Most of that growth came from big investment portfolio sales rather than individual major transactions.”
Foreign investment in U.S. real estate appears to be slowing, Schein said.
“They’re tapping the brakes for now because of uncertainty around the Federal Reserve, the government shutdown and budget deficits,” he said. “The U.S. doesn’t look as stable as in the past.”
However, recession risk, which often has a psychological impact on real estate investment, is relatively low, Calanog said. Calanog indicated that, in his view, there is currently approximately a 27% probability of a recession in 2026. In addition, private credit is likely to be available for investors over the next year or two, he said.
Multifamily Investment Opportunities
Calanog said that disruption in the multifamily sector due to additional supply in some markets offers what he described as a “near historic” investment opportunity in apartments.
“There’s still a good amount of supply coming online, but investors may want to take a serious look for good re-priced assets,” he said. “Multifamily appreciation returns went slightly negative in the fourth quarter of 2025, according to NCREIF, after a few months of tepid rent growth in many markets.”
Capital appreciation returns, which measures the change in market value adjusted for any capital improvements or partial sales for the quarter, dipped by 0.01% in the fourth quarter of 2025, according to NCREIF. (Source: https://ncreif.org/news/ NPI Snapshot Report Q4 2025)
“Don’t get me wrong: multifamily still has amazing near-term to long-term prospects, but in the short run there might be some disruption in some markets that investors can take advantage of,” Calanog said. “There may be some off-market opportunities or at least there may be a little less competition and some more space for negotiations.”
Interest Rates, Employment and Local Dynamics Impact Multifamily Sector
While short-term commercial real estate interest rates have already come down and correlate with the overnight interest rate, long-term interest rates have stayed relatively high.
“Over the last year or two, there’s been less volatility in long-term interest rates,” Calanog said. “The 10-Year Treasury appears to be stabilizing around 4.2%, which isn’t bad. People are getting used to that rate.”
Calanog anticipates that the Fed will pause their rate cuts in 2026, dropping the federal funds rate by .25% at most this year.
“One concern is the job market, which if you look back at 2025, averaged just under 50,000 new jobs per month,” Calanog said. “That’s the weakest job growth other than the Great Recession, so we’re basically just treading water.”
In markets with an oversupply of multifamily units over the past two years, Calanog anticipates that some asset managers may need to offer concessions to attract new tenants. That means effective rent may fall this year in some markets, he said.
“But what really drives real estate is always inherently local, based on the individual asset and the neighborhood,” Calanog said.
He recommends that investors go back to basics and dig into local market conditions in the context of national or regional trends.
This material is provided for informational purposes only and is a summary of remarks made by third parties during a public webinar. The views expressed are those of the speakers and do not necessarily reflect the views of Greystone. The information provided in this article, including, without limitation, any opinions, predictions, forecasts, commentaries or suggestions, should not be construed as investment, financial, legal, tax or other advice. Any forward-looking statements and economic forecasts are inherently uncertain, and actual results may differ materially.