The Most Insightful Hour in CRE Part 24 with Dr. Peter Linneman

Together, they unpacked the forces shaping today’s market, including employment trends, inflation, rent growth, housing affordability and supply, AI’s impact on jobs, and Peter’s predictions for rate cuts, oil prices, tariffs, and more.

1. Who is Peter Linneman? 

Dr. Peter Linneman is a leading real estate economist, the founder of Linneman Associates, and the author of the widely read Linneman Letter, where he shares data-driven views on the U.S. economy, capital markets, and commercial real estate. He is also a recurring guest on the Walker Webcast, joining Willy Walker for their quarterly segment The Most Insightful Hour in CRE, helping investors, owners, and lenders make sense of what is happening in the market and what it means for the road ahead.

2. What are the top reasons to listen to this webcast? 

• ‍A clear macro read when signals feel contradictory
  Peter explains why the economy still “moves forward” despite weak confidence readings, higher gold prices, and uneven CRE performance.‍
• A supply-driven roadmap by asset class through 2027
  He breaks down why office, retail, and parts of industrial improve faster than people expect, and why multifamily takes longer, largely because of supply.‍
• Actionable calls on rates, AI, and public versus private pricing
  He lays out why he expects meaningful rate cuts, why AI margins look great now but invite oversupply later, and why REITs price at a persistent discount to private markets.

3. How does Peter feel about the economy as 2026 begins?

He says the picture becomes clearer, not perfect. A solid holiday retail season signals that consumers still have jobs and money, and more data points support a “pretty good” baseline economy rather than a downturn scenario.

4. Why does Peter expect bigger rate cuts than the market predicts in 2026?

He argues policy remains above neutral. Using inflation excluding shelter, he sees underlying inflation close to long-run norms, which supports cutting at least 50 bps to get closer to neutral, with a realistic path to 75 to 100 bps as new Fed appointees arrive and cuts are paced over the year.

5. Why does Peter say CPI rent growth looks wrong?

He says measured rent growth in CPI does not match what multifamily owners experience and is no longer explainable by a simple lag. He does not fully reconcile the gap and suspects sampling issues, but he is clear that owners are not seeing CPI-like rent increases.

6. Why does oversupply matter more than demand in today’s CRE downturn?

Peter separates fundamentals from pricing. Demand holds up across many sectors, but oversupply is the drag on rent growth, and higher capital costs pressure valuations. His core point is that supply, not demand, drives the pain in this phase.

7. Why does Peter argue the U.S. housing problem is fundamentally a supply issue?

He ties the argument to sustained price appreciation. He says long-running home price gains signal a structural shortage in the markets people want to live in, driven by entitlement friction, delays, fees, and constraints that make building difficult and risky.

8. What is his message on AI and data centers right now?

He says AI-related businesses “cannot lose” in the next few years because so much capital is already committed, supporting strong near-term margins. But he warns that high margins historically invite overbuilding, so the risk shows up later in the cycle, not immediately in 2026 or 2027.

9. What does he think about public REIT pricing versus private market pricing?

Peter says public REITs often trade at a meaningful discount to private values, which can offer a better unlevered yield. But he cautions the discount only pays off as a capital gain if it closes, and it has not reliably closed because not enough capital consistently arbitrages the gap.

10. Where does Peter see the best risk-adjusted opportunities across CRE through 2027?

He points to sectors and markets where supply pipelines are collapsing while demand holds steady. Office, retail, and select industrial markets will improve faster than many expect, while multifamily will take longer to recover because excess supply needs more time to clear.

Watch or listen to the replay.