Monday Market Moves | Week of 28 April 2025
Welcome to Monday Market Moves, the weekly series from Essex Capital Markets briefing you on Chicago commercial real estate capital markets. We cover key trends in CRE debt, refinancing, and capital structures to help investors, borrowers, and lenders navigate today’s evolving environment.
This Week: Navigating 2025’s CRE Landscape
In today’s market, it’s not just about waiting for rate cuts – it’s about how investors and sponsors adapt to current conditions.
Here’s what we’re seeing across CRE this week at Essex Capital Markets:
- Capital Markets Creativity
With financing still selective, successful deals are leaning on innovative structures—from preferred equity and mezzanine debt to assumable loans and interest-only terms. It’s no longer about highest leverage—it’s about smartest leverage. Creative financing lenders are playing a key role, stepping in with flexible capital solutions that help sponsors close in a tougher debt environment.
- Sector in Focus: Industrial Strength
Chicago’s industrial market kicked off 2025 with 8.1M SF leased in Q1, signaling sustained tenant demand despite tighter financial conditions. Chicago continued to outperform the national market with a vacancy rate of 5.8%. With new construction slowing, landlords continue to hold pricing power—particularly along key corridors like I-80.
- Office: Finding Opportunity Amid Distress
While headlines focus on vacancy rates, savvy investors are eyeing distressed office assets for repositioning plays. Chicago’s LaSalle Street conversion projects highlight how adaptive reuse is turning challenges into long-term value.
- Retail’s Quiet Momentum
Retail vacancies remain the lowest across major sectors (~4.1%). Grocery-anchored centers and urban storefronts are driving demand, proving that well-located retail is far from obsolete.
- Investor Mindset
The best players aren’t sidelined—they’re strategizing. We’re seeing increased activity around refinancing upcoming maturities, sourcing JV equity, and selectively acquiring discounted assets where fundamentals remain strong.
At Essex Capital Markets, we’re helping clients navigate this environment by structuring smart, strategic capital solutions that align with both current realities and long-term goals—across acquisitions, refinances, and recapitalizations.
To speak with our Capital Markets team and learn how creative financing lenders can support your next deal, please fill out the form below.