With the arrival of 2025, I have been reflecting on prior articles that discussed when and where we believed commercial real estate (CRE) distress would emerge at scale. The good news is that this year may finally bring a gift to opportunistic buyers. In June 2023, based on the precedent of the global financial crisis in 2008-2009, I predicted that outside the office sector and a few isolated multifamily transactions, distressed buying opportunities wouldn’t emerge for several quarters. More recently, one of our top 10 predictions for multifamily for 2025 called for an acceleration of realized losses by lenders.

Now, the CRE market faces a critical shift: the end of “extend and pretend” and the rising likelihood of lender-driven sales. This finally could create significant distressed buying opportunities for investors seeking office assets or older-vintage and value-added multifamily. That said, we still see limited buying opportunities emerging for distressed instituti