The 10-year Treasury’s swing from above 5.3% to 4.8% has JPMorgan analysts forecasting flat Q4 capital markets revenue at top brokerages.
By Nina Dale Via CRE Daily – Click here for complete article and others
| Rate whiplash has the largest CRE brokerages bracing for a flat finish to the year, as a Treasury spike stalled the deals that normally close by December, according to Bisnow. |
| By the numbers: According to JPMorgan, Q4 capital markets revenue across CBRE, JLL, Cushman and Colliers should land flat YoY, down from an earlier call for 10% growth. Q4 typically delivers about 30% of a year’s capital markets revenue, and December alone roughly 15%, so the timing stings. |
| What’s happening: The 10-year Treasury topped 5.3% in early October before sliding to about 4.8%, enough movement to freeze buyers mid-deal. CBRE’s Bob Sulentic said cap rates have risen, contracted sales are being retraded, and some expected deals are turning into refinancings. |
| Mixed signals: The year was strong until the shock. YTD capital markets revenue through Q3 climbed 21% at JLL, 14.5% at Newmark and 10% at Cushman & Wakefield. Cushman’s Michelle MacKay said her pipeline has barely moved, and Colliers still expects pipelines to grow, just slower than planned. |
| Looking ahead: JPMorgan sees a rougher 2027, with capital markets revenue down 20% in Q1, narrowing to a 10% decline in Q2 before returning to growth by Q4. Newmark was more bearish, warning that sustained volatility and higher yields could cut activity 20% to 30%. |
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| Why it matters: Multifamily looks most exposed because it carries the lowest cap rates, while office has a cushion after repricing early. More than 80% of traders expect a quarter-point Fed hike in December, so where yields settle will decide how many deals close this year. |
| ➥ THE TAKEAWAY |
| Stability is what sells: Buyers and sellers want rates to stop moving, not for them to fall. A rate-driven freeze can thaw faster than a demand-driven one, so stalled deals may resurface in early 2027 once the 10-year finds a level. |
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