In our mid-year take on the 2025 commercial real estate market^1^ , exploring why many investors see it as a transitional year. We looked at early signs of recovery, sector by sector, and the forces shaping market sentiment heading into the second half.
The big theme was the impact of limited new supply — especially in multifamily — in driving valuations higher, pulling occupancy back toward historical norms, and bringing institutional capital off the sidelines.
In the days since that article, we’ve seen a few headlines that we think are relevant to the themes we covered. With that in mind, we’ve put together a short roundup of some notable developments in CRE.
An important disclaimer: neither these headlines nor mid-year article should be viewed as confirmation of a full recovery. The market still faces risks — from higher interest rates to uneven valuations across asset classes — and investors should keep those factors in mind when weighing their allocations.
[[[Carlyle Raises Largest U.S. Real Estate Fund to Date]]]
Carlyle Group, one of the world’s leading investment firms, just raised the largest real estate fund in firm history – surpassing its previous record of $8 billion in 2021, during the peak of the post-pandemic CRE cycle. Carlyle will put the new funds into the residential, self-storage and industrial sectors.
Why It Matters: CRE fundraising has rebounded in 2025 after falling to a decade low last year, helped by large commitments from institutional investors like this one. More capital in the market can support transaction activity, help projects move forward, and signal improving sentiment across the industry.^1^
[[[Restaurants Clamor for Retail Space in NYC’s Sizzling Market]]]
Demand for restaurant space in New York City is near record highs, with some tenants spending as much as $100,000 to convert other types of retail space into kitchens. In Q2, retail availability across 11 of Manhattan’s busiest shopping corridors fell to 12.8% — the lowest level since late 2014.^2^
Why It Matters: Falling availability rates, as discussed in our recent article, are a key sign of rising demand and can signal future rent or valuation growth.^3^ While the restaurant recovery has been uneven nationally,^4^New York City shows that demand in certain regions is reaching record highs.
[[[Blackstone Signals Ongoing Confidence in CRE Market]]]
Arguably, the world’s most famous global investment firm has been a consistent presence in CRE for more than 18 months, and its latest earnings call was no exception. Fundraising for the category rose quarter over quarter to $7.2 billion, while deployment increased to $6.16 billion.
Why It Matters: Arguably no firm has done more to support a CRE recovery than Blackstone, which has consistently highlighted the opportunity to acquire assets at a discount.^5^ As the market approaches the end of that discount window, many were encouraged to see Blackstone’s investors double down on the asset class — and for the firm to keep putting that capital to work.^6^
Taken together, these headlines point to a CRE market that, while still navigating real challenges, is attracting meaningful capital and showing pockets of strong demand. From major fundraising wins to sector-specific momentum, activity across these fronts reinforces the themes we explored last week — and underscores why many see 2025 as a year of transition for the asset class.
As always, CRE is not without its challenges, and investors should weigh ongoing risks alongside any signs of momentum.
For more insights from Crowd Street, check out our recent piece on CRE valuations.
