Newmark Group has reported its Q1 2025 results, with year-over-year revenue growth of 21.8% and net income still negative but an improvement over Q1 2024 by 46.1%. Some interesting signs are big boosts in leasing fees and capital market revenues.
Earnings of major brokers have been shining light into some of the shadows that CRE has developed post-pandemic and during recent global trade uncertainty. Tariffs overshadowed a strong quarter for CBRE. Office and industrial leasing fueled Cushman & Wakefield’s revenue gains, with tariffs showing limited impact.
Newmark is another company that, at least so far, may have avoided some of the problems tariffs seem to have brought, including widening loan spreads and growing expectations of a recession. During the company’s earnings call, the word tariff was mentioned only once, which was part of an analyst’s question.
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However, during the earnings call, CEO Barry Gosin did caution of “potential geopolitical headwinds” that could exert a “dampening effect on industry activity.” That could easily refer to international trade; tensions between the U.S. and large trading partners Mexico, Canada, and China; and the implications of tariffs. It could be that such problems are more likely to appear in the future, especially as the real impacts of tariffs that largely started to appear last month are something for more investors, developers, and owners to keep in sight going forward.
Gosin also said that the CMBS market has slowed, although Newmark has seen deals and leases continue to go through. He added that banks have been “bridging the gap at this point” and that the company has seen bank loans for the first time in a while. However, “it’s too early to tell” what influence tariffs and other parts of Trump’s economic policies will have. It would likely take another quarter for a more certain sense.
The highlights of Newmark’s results were leasing and capital markets. Leasing fees were up year-over-year by 31% from increased activity in New York City and Boston and a “strong rebound” in the San Francisco Bay area, according to the CRE firm.
Capital market revenue was up by 32.7%, which “outpaced the industry” in investment sales, origination, and advising on an “increasing number of portfolio and entity M&A deals.” That represented a 62.5% volume improvement with growth in every major property type, including a 40% increase in GSE FHA origination volumes, according to Chief Financial Officer Michael Rispoli.
Newmark’s Q1 suggests that the CRE market was moving toward normal. What will happen in Q2 with trade policies, higher prices that might drive inflation up, and a slight Q1 drop in GDP is unknown.
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