Alternative Investing Report - June 2, 2025

*as of 6/1; Sources: S&P, BTC, FTSE, DJRE, GOLD

Net absorption is a common metric used in the commercial real estate sector that measures the net change in occupied space, looking at the amount of space that tenants lease versus the amount they vacate. After the sector posted its first positive net absorption rate since 2022 in Q1, office properties took a step backwards in April, showing negative absorption and the highest vacancy rate on record. Meanwhile, retail and industrial each saw vacancy rates inch up while rent growth slowed. Multifamily properties had the strongest April of any sector, with net absorption rates up 22% year-over-year and rent growth stable. Finally, the hospitality sector stayed steady, with comparable occupancy rates to the prior two Aprils.

➨ TAKEAWAY: The general uncertainty over the economy and tariffs seems to have affected most sectors, particularly office and retail. However, while net absorption for offices was negative (-4.8 million sq ft), that number was significantly higher (-47.5 million sqft) a year ago. Rent growth is still positive across all sectors, and on the whole, the commercial market is still on the way up from its post-pandemic lows.

In this episode of Smart Humans, Slava Rubin talks with Vintage Investment Partners founder Alan Feld about managing $4.5 billion, the venture capital market, finding great managers, and the importance of thinking long-term when investing.

📊 PCE numbers: The Fed’s preferred measure of inflation, the Personal Consumption Expenditures (PCE) index, showed a lower-than-expected 0.1% growth rate in April and an annual growth rate of 2.1%. While that is very close to the Fed’s 2% target, markets did not react strongly, as there is still doubt about future readings due to tariff policy.

🚀 VC secondaries market: The size of the secondaries market is an estimated $60 billion, up from last year’s $50 billion mark, as sellers look for liquidity and buyers seek discounted startup shares.

🪙 Weekend sell-off: While Bitcoin and Ethereum saw slight decreases over the last week, other major coins such as Solana (-12.2%), Dogecoin (-16.1%), and Cardano (-10.7%) all recorded double-digit declines, as investors backed away from riskier assets.

🤖 DeepSeek’s new model: The Chinese AI startup released an upgraded version of its R1 reasoning model, and its performance is catching up to that of OpenAI’s and other rivals.

📊 Consumer sentiment improves: A survey taken at the end of May in the wake of a temporary trade agreement between the U.S. and China showed consumer sentiment back up to where it was in April, though it is still down 32% in 2025.

🪙 SEC drops Binance lawsuit: The agency is no longer pursuing charges against Binance, the world’s largest crypto exchange, for illegally serving the US and potential misuse of customer funds. The shift is another example of the SEC stepping away from enforcement actions, a consequence of the Trump administration’s pro-crypto actions.

🏡 Dubai real estate reckoning: After years of booming development and rising prices, the ratings agency Fitch is projecting prices in the Dubai real estate market to drop by double digits over the next twelve months.

🎨 $7 million painting found in barn: A 17th century painting by the Dutch master Frans Post sold for $7.4 million at Sotheby’s, a record for the artist, caping off a remarkable story after the artwork was found in a barn attic in 1998.

Tuesday: Job Openings and Labor Turnover Survey released; Heritage’s Watches & Fine Timepieces auction, featuring four six-figure watches.

Wednesday: Game 1 of the NHL Finals between the Florida Panthers and Edmonton Oilers.

Thursday: Game 1 of the NBA Finals between the Oklahoma City Thunder and Indiana Pacers; Eid al-Adha begins.

Friday: U.S. employment report released.