Money & Finance › Markets of the world
Commercial real estate markets: office, industrial, retail, apartments
· Asset or instrument
Fact, law or dataA rule, statute, definition or measured number.
The market for income-producing property: offices, warehouses, retail, apartments, hotels and newer types like data centers.
See it on the Money & Finance map →How it works
Each property type runs its own cycle. In mid-2026, national office vacancy ranged from about 14% to 21% depending on the data provider, near record highs, while industrial sat near 7% and apartments at 7–8%. Values equal NOI divided by a cap rate, so they move with rents and with interest rates. US commercial and multifamily mortgage debt passed $5 trillion in 2026 (MBA): banks hold about 38%, Fannie Mae, Freddie Mac and other agencies about 23%, life insurers and CMBS most of the rest.
Why it matters
Commercial property is a major store of wealth and bank collateral; when values fall, as offices did after 2022, losses spread to lenders, CMBS investors and city tax bases.
Facts, rules and data
MBA quarterly mortgage-debt reports, vacancy data from CoStar, CBRE, Cushman & Wakefield and Moody's, and price indexes from MSCI and Green Street.
Debates and risks
Office values are uncertain because few buildings trade; where the bottom is, and how much demand remote work removed for good, is still debated.
Inside this (7)
- The US office market: remote work and record vacancy
- Industrial real estate: warehouses, ports and e-commerce
- Retail real estate: struggling malls, resilient strip centers
- Apartment (multifamily) real estate
- Hotels: real estate that reprices every night (RevPAR)
- Data centers: the AI-driven building boom
- CRE capital markets: deal volume and the cap-rate cycle
Connections (4)
▸Commercial real estate markets: office, industrial, retail, apartments are the income-property side of Real estate as an investmentFact, law or data
The connection
Real estate as an investment spans homes and income property. Commercial real estate is the income side: buildings are valued on the net operating income tenants generate rather than on comparable home sales. That ties CRE values to leases, credit markets and interest rates.
When and why
Nationwide; US commercial and multifamily mortgage debt alone passed $5 trillion in early 2026 (MBA).
How we know
MBA debt data, Fed Z.1 real-estate tables, and price indexes from MSCI and Green Street.
Debates and risks
Total US commercial property value is estimated, not measured; estimates from different sources vary by trillions of dollars.
▸Commercial real estate markets: office, industrial, retail, apartments are priced through Cap rates: how real estate is pricedFact, law or data
The connection
Value equals NOI divided by the cap rate. A building with $1 million of NOI is worth about $14.3 million at a 7% cap, but $12.5 million at 8%, about 12.5% less. Cap rates follow the 10-year Treasury plus a risk spread, so rising rates after 2022 cut values even where rents held.
When and why
In appraisals and sale pricing nationwide; tracked by CBRE's surveys and MSCI's transaction data.
How we know
Appraisal standards (the income approach) and published cap-rate and price indexes showing the post-2022 rise.
Debates and risks
Office cap rates are uncertain because few buildings trade, and many recent sales are distressed.
▸Commercial real estate markets: office, industrial, retail, apartments rely heavily on Commercial real estate loans: how income property is financedFact, law or data
The connection
Most property purchases and refinances use debt, often 50–70% of value, and loans roll over every 5–10 years. So lending conditions drive the market: when credit tightened in 2009 and 2023, sales volume fell by half or more and prices dropped. Lenders also specialize: agencies dominate apartments, CMBS is prominent in hotels and retail.
When and why
Every US property sector; about $5 trillion of commercial and multifamily mortgages was outstanding at end-2025 (MBA).
How we know
MSCI deal data, MBA origination and debt surveys, and the Fed's senior loan officer surveys showing tighter standards before sales slowed.
Debates and risks
Estimates of total US CRE value vary widely, so the overall share financed with debt, well below a single deal's 60–70%, is uncertain.
▸Real estate investment trusts (REITs) let small investors own pieces of Commercial real estate markets: office, industrial, retail, apartmentsFact, law or data
The connection
REITs pool investor money to own or finance commercial property, and their shares trade daily. That lets an individual own a slice of offices, warehouses or apartments for the price of one share. Because they reprice daily, REITs often signal changes in private property values months before appraisals do.
When and why
Created by Congress in 1960; Nareit estimates REITs of all kinds hold over $4 trillion of gross real estate assets.
How we know
Nareit data and research showing listed REIT returns lead private, appraisal-based property indexes.
Debates and risks
When REITs trade far below their asset values, as office REITs did in 2023, it is debated which price is right.