Cap Rates September 2025 | Research Brief
- The Vara Group
- 10 minutes ago
- 1 min read
Many investors assume cap rates move directly in line with interest rates. While the two have generally trended lower together over time, the correlation is limited. Our September 2025 Research Brief shows that transaction velocity is a much stronger driver of cap rate movement than interest rates alone.
Key Findings:
🔹 The correlation between the 10-Year Treasury yield and cap rates is just 40 percent
🔹 Transaction activity has a stronger inverse correlation at 78 percent
🔹 $200B+ in capital remains on the sidelines
🔹 $960B in commercial real estate debt set to mature in 2025
🔹 Market conditions point to greater sales activity and potential easing of cap rates
As market dynamics shift, investors should watch not only interest rates, but also deal velocity and capital deployment, which are emerging as more telling indicators for cap rates September 2025.
