Yardi Executive Summit Special Report: Economic Outlook Article originally posted on Commercial Property Executive on May 5, 2026 Yardi Matrix Vice President Jeff Adler offered a mixed but generally favorable economic outlook during the recent Yardi Executive Summit in New York City, terming it a “repeat of the 1930s” and urging attendees to keep an eye on the fiscal deficit and not to be distracted by the war in Iran. While large deficits remain unresolved, Adler said he anticipates the 10-year Treasury yield to be 4.0 to 4.5 percent. “This is the big thing,” he emphasized. Meanwhile, GDP should reaccelerate to about 2.5 percent this year, with only modest cuts in interest rates and long-term rates normalizing. While oil prices will continue to elevate, he does not see an increase in money supply and thus expects core inflation to remain stable. And while the labor market has seen a structural softening—with all job formation in healthcare—it has held up cyclically, helped by AI-driven productivity. In the real estate market, for the long term multifamily continues to be undersupplied—a manmade problem Adler expects to take 40 to 50 years to resolve, given the country’s lack of investment in housing since the formation of LIHTC. However, the shorter-term oversupply is getting absorbed, which should help the sector normalize by 2028-29. Improvement should occur faster in the Northeast and Midwest, which should achieve 3.5 percent rent growth; the Sun Belt will take longer to normalize from its higher amount of new supply but by and large should achieve growth ranging from 2 to 5 percent sometime after 2029. Interestingly, many emerging markets have seen rent growth despite falling occupancy. The state of retail and office The retail and office sectors are at different points in what is effectively a natural 25-year cycle, although both were hurt by the Covid pandemic. Retail has been emerging from 25 years of restructuring, with real, in-place rent growth now occurring. Office is still only about five years into its recovery, slowed by the need to resolve what to do with older stock, as AI, tenant preference for shorter and more flexible space use, and growing interest in coworking space reduce demand. Keep an eye on sublease space as an indicator of sector performance, Adler advised. Meanwhile, Covid-related debt problems still need to be resolved, although lenders have been building up reserves in preparation. Industrial levels off Industrial sector growth has slowed, but supply and demand remain roughly in balance, he said. While the pace of rent growth has dropped, it is “fundamentally in decent shape,” and demand is expected to level off. Meanwhile, investors remain interested, with particular enthusiasm for data centers—although growth in that emerging sector remains limited by infrastructure concerns and NIMBYism. Policy impacts, though, are primarily “about the debt,” Adler reiterated, with a secondary issue the global relationship between the U.S. and China.