Build for the Storm Ahead 🌪️

Make Assets Climate-Ready Now

Author

Anne Morgan
October 29, 2025

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Hello, Commercial Real Estate Pros! 🏢

Rising storm costs are forcing real estate to rethink resilience. Climate risk now shapes which projects move forward and how they are financed.

Is your portfolio built for endurance or exposure?

📰 Upcoming in this issue

  • 🌪️ Storm Costs Soar, Forcing Real Estate to Reinvent Resilience

  • 💻 Why 80% of Real Estate Firms Are Doubling Down on Tech

  • 📊 Why CRE Investors Are Suddenly Bullish Again

🌪️ Storm Costs Soar, Forcing Real Estate to Reinvent Resilience

RREAF’s Kip Sowden says climate risk now decides which projects get built. With 27 billion-dollar disasters in 2024 and insurance losses topping $80 billion in early 2025, underwriting and site selection have become resilience tests. Insurance math, not marketing, is driving how and where developers build next.

Key Takeaways:

  • 🌊 Insurance Shapes Feasibility: Premiums are forecast to climb 8.7% annually, hitting $4,890 per month by 2030.

  • 🏗️ Resilience Becomes ROI: RREAF treats storm-proof features as capital investments with defined payback periods.

  • ⚡ Tech Prevents Losses: Predictive maintenance tools catch HVAC or water issues before they cause multimillion-dollar damage.

  • 👷 Culture Builds Strength: After Hurricane Helene, onsite teams led relief faster than corporate could, proving that resilience is human, too.

💻 Why 80% of Real Estate Firms Are Doubling Down on Tech

JLL’s new global survey shows 80% of real estate leaders plan to boost tech budgets by 15% or more in 2025. From AI-powered leasing tools to carbon tracking, the industry is shifting from experimentation to enterprise-scale adoption to cut costs, meet ESG goals, and sharpen investment decisions.

Key Takeaways:

  • 📈 Budgets Jump 15%+: Most firms plan double-digit increases in proptech spend over the next year.

  • 🏢 Data Takes Center Stage: Portfolio analytics now drive decisions on occupancy, energy use, and capital planning.

  • 🌍 ESG Tools Scale Fast: Carbon tracking and intelligent building systems move from pilot to portfolio-wide deployments.

  • 🤝 Integration Beats Novelty: Firms prefer connected tech ecosystems over flashy one-off tools to improve ROI.

📊 Why CRE Investors Are Suddenly Bullish Again

Marcus & Millichap’s latest Investor Insights shows a mood shift as commercial real estate investors bet the bottom is in. Cap rates are up 80 to 130 basis points since 2022, pricing has reset, and confidence is building around lower rates, leaner construction, and steadier returns heading into 2026.

Key Takeaways:

  • 💰 Cap Rates Rebound: Up 80 to 130 bps since 2022, drawing buyers back for below-replacement-cost assets.

  • 🏢 Sector Strengths Emerge: Multifamily, infill industrial, and grocery-anchored retail lead optimism across CRE.

  • 📉 Rates May Ease: Many expect the 10-Year Treasury to dip into the upper 3% range by 2026.

  • ⚖️ Stability Wins: Investors see CRE returns as steadier than equities or gold, hinting at a new buying cycle.

Why It Matters

Stronger design and predictive maintenance reduce losses and protect long-term value. Start by treating resilience features as capital investments with measurable ROI.

Cultural readiness and local response plans turn risk into reliability.

Catch you in the next issue,

Anne Morgan
Editor-in-Chief
Commercial Real Estate Weekly

P.S. Interested in sponsoring a future issue? Just reply to this email and I’ll send packages!

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