The Walker Webcast, held live in Philadelphia on Jan. 15, 2025, marked two significant milestones. It was the 20th time that Walker & Dunlop President and CEO Willy Walker had welcomed economist and author Peter Linneman as his guest. The event also celebrated the 25th anniversary of Linneman’s renowned economic newsletter, the Linneman Letter.
During the webcast, which covered a range of topics from a review of the past quarter century to current events and a forecast for 2025, one topic discussed was natural disasters such as the ongoing Russia-Ukraine War and recent Southern California wildfires.
Linneman noted that while these events have been devastating in their own right, they have actually benefited certain aspects of the U.S. economy. For example,the U.S.’s position as top oil producer has led to an increase in exports due to disruptions in Ukraine’s oil production.
Another topic touched upon by Walker and Linneman was how proposed tariffs by then-President-Elect Donald Trump could potentially impact inflation rates (which were currently at around2 .9%). However,L innemans tressed that history has shown tariff increases do not necessarily lead to significant changes in inflation rates.
The conversation then turned towards interest rates relative toc ap r ates,a nd Linne man predicted acap rateof5 % withinthe next12-24 months along with increased capital flow into commercial real estate investments.However,h e cautioned against relying too heavily on interest rate fluctuations when making investment decisions,givingan analogyofa n ocean whereinterestratesarelike these abedandcapitalflows are like rainandwind s.Theseabedmayhave some influence,but ultimately it is external factors like capital flows that drive market trends.In this case,Linne man suggestedthat insteado f focusingon short-term changesininterestrates,itwasimportantto considerlong-termt rendsand opportunitiesinthe market.
When asked to make predictions for 2025, Linneman forecasted a GDP growth of2 .7%-2.9%,S&P500growthof7 %-9 %,and crude oil prices at $68-$70 per barrel.He also predicted a drop in the Effective Federal Fund Rate by 100 basis points.In terms of commercial real estate investments,Linne man suggested that multifamily properties may be attractive for “stay rich” investors while office spaces could appeal to “get rich” investors due to potential NOI problems and capital flow issues.Data centers,on the other hand,may attract riskier investments as there is always a possibility of overbuilding despite high demand.
For those who missed the live webcast,it is available on-demand through various channels such as YouTube,Spotify,and Apple.Subscribers can receive invites,replays,and articles for new episodes every week.
