Two senior leaders from Keller Augusta’s recruitment team, Managing Director Sierra Olney and Senior Director Kate Mecke, attended the Pension Real Estate Association (PREA) 2026 Spring Conference that was held at the JW Marriott in Nashville, Tenn. from March 26–27.

Conference attendees tentatively embraced a more positive outlook on the market, though continued challenges around capital raising for certain strategies are creating pressure across the industry.

The market remains highly segmented by sector and property grade, with high-quality assets seeing recovery, while pricing and demand challenges persist. These dynamics are expected to drive increased movement in hiring, as top talent gravitates toward platforms that are nimble and positioned to navigate ongoing market volatility.

Here is a collection of our five takeaways from the event:

1. Ongoing CRE recovery in some sectors is sustaining optimism 

The ongoing recovery of high-quality assets in strong or growing markets across the country has spurred a level of optimism among investors, but many market participants are still cautious, with an eye on economic indicators that could upend progress, such as inflation. At the same time, the market remains highly segmented by sector and property quality, and pricing and demand challenges continue to drive divergence across asset types and strategies.

Regionally, Sun Belt markets like Dallas-Fort Worth, Miami, and Nashville continue to lead due to population and job growth. Major coastal hubs such as San Francisco and New York are showing early signs of recovery in the office sector, supported by tech and AI investment.

2. Looming cliff of maturing debt spells some risk

Approximately $1.8 trillion in CRE loans are set to mature before the end of the year, which spells refinancing risk for properties struggling with sluggish cash flows, especially as many lenders become more aggressive in resolving distressed situations. Even still, bank lending activity is picking up, as commercial property loans on bank balance sheets came in at $3.07 trillion in February, a 2.1% uptick on the year, per Federal Reserve data. 

Capital is available, but selective, favoring assets with stable income and strong fundamentals; despite the resurgence of banks, private credit has stamped its place on the lending market, carrying outsized influence as a key solution to filling gaps left by traditional banks or by equity that has either exited deals or is reticent to commit new capital. These dynamics are driving the market and influencing a variety of investment decisions.

3. Sector trends continue to diverge

Data centers are, of course, the fastest-growing sector, driven by the current rush for digital infrastructure development and AI adoption. Industrial and logistics fundamentals remain strong, supported by long-term e-commerce growth and nearshoring trends, but performance is normalizing after pandemic highs. Multifamily remains attractive as a safe haven for capital, especially given the fervent demand for housing across the country, particularly in major coastal markets; this is also supported by elevated mortgage rates and limited accessibility of for-sale housing.

4. Office requires a nuanced, deal-by-deal approach

It’s clear that the office sector is split between “bulls vs. bears,” a prominent point of discussion that highlighted the lack of consensus across the market. 

One event discussion featured a live audience poll that was essentially evenly split, reflecting the broader uncertainty that still permeates. Key considerations for those in the market included entry basis, capital expenditure requirements, relative value, durability of cash flows, and supply dynamics. The sector continues to be split across three tiers: Trophy and Class A assets in major markets are seeing positive absorption and rent recovery; Class B and C assets face structural obsolescence and higher vacancy; conversions to residential are increasing, though costs and zoning challenges persist. Overall, office remains a highly idiosyncratic asset class requiring deal-by-deal evaluation.

5. A number of factors are adding to deal complexity

Generally, investors and tenants are gravitating toward newer buildings that meet modern ESG and energy standards; insurance costs are rising due to climate risk in many regions, and energy-efficient upgrades are increasing operating expenses. As more organizations adopt technology and AI, cybersecurity risks, such as digital fraud and payment attacks, are also increasing. These factors are adding operational complexity across the market.

Keller Augusta’s Sierra Olney and Kate Mecke work with clients to conduct searches for myriad commercial real estate functions, from executive-level positions to construction, finance and asset management roles. Contact Sierra and Kate today to get started bolstering your organization.