Episode 28: Why 4.22% Is the Magic Number for CRE Right Now

What this episode covers

Welcome back to What's Hot & What's Not CRE — your daily pulse on commercial real estate in America. It's Wednesday, January 28th, 2026. Today we're tracking the 10-year Treasury and what it signals for CRE deal flow. 🔥 What's Hot — Rate Stability Unlocking Capital: 10-Year Treasury at 4.22-4.25% this week — the stability zone unlocking deal flow Fed holding steady at 3.5-3.75%; markets pricing 45% odds of June cut; two total cuts expected in 2026 CRE transaction volume projected to increase 15-20%; institutional and cross-border capital re-entering Cap rate spreads attractive at 2.29% average (2021-2026) — better than long-term average of 2.15% Sale-leaseback activity benefiting from Treasury stability ❄️ What's Not — Inflation Sticky, Cuts Uncertain: Inflation still above Fed's 2% target — limiting aggressive cuts J.P. Morgan no longer expects January cut; some forecasts show Fed on hold through all 2026 2021-2022 vintage floating rate debt still creating distress Office cap rates most sensitive: 78 bps move per 100 bps Treasury change; industrial most insulated at 41 bps 📊 Why It Matters: The 10-year at 4.22% with stability is the key signal. Absolute level matters less than predictability. Transaction volume rising 15-20% signals confidence returning. But sticky inflation means fewer cuts than hoped. 💡 Investor Takeaway: Treasury stability is more important than Treasury level. At 4.22%, the math works for well-located assets with strong cash flow. Industrial and multifamily most insulated. Office and retail most exposed. Expect two cuts in 2026, but don't bank on more. Thanks for tuning in. See you tomorrow! Don't forget to Like, Share and Subscribe! Visit hotnotcre.com to learn more and subscribe to our newsletter.

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