The US commercial real estate market recorded improving conditions across several key sectors in the third quarter of 2026, with stronger leasing activity, rising occupancy and a better balance between supply and demand supporting the outlook.
Baker Tilly’s latest market report found positive developments in multifamily housing, senior housing, office, retail and industrial property. Slower construction activity has helped reduce competition from new supply in several sectors, while stronger tenant demand is supporting occupancy and leasing.
The office market continued to strengthen, with increased leasing demand and improving occupancy. Limited new construction and the removal or conversion of existing buildings are also reducing available inventory. Retail property benefited from resilient tenant demand and historically low levels of new development, while industrial property recorded improvements in leasing activity and net absorption.
Senior housing also continued to gain momentum, supported by favourable demographic trends, rising occupancy and limited new development. The report points to growing institutional investor interest as demand strengthens and supply remains constrained.
Oxford Economics’ 2026 Commercial Real Estate Megatrend Resilience Index provides further insight into where long-term investment opportunities may emerge. Assessing 91 cities across 33 countries, the index evaluates how commercial property markets are positioned to respond to technology, demographic change, climate risks and geopolitical developments.
European cities performed strongly, with Dublin, Oslo, Zurich, Stockholm and London leading the overall rankings. Industrial property was identified as the most resilient sector across the cities assessed, followed by residential, retail and office property.
The findings reinforce the importance of property quality, location and sector fundamentals when assessing future investment prospects. Technology is also becoming an increasingly significant factor, with artificial intelligence, connected building systems and data analytics creating opportunities to improve building management, operational efficiency and tenant services.
Real Estate Credit Investments Limited (LON:RECI) is a closed-end investment company that specialises in European real estate credit markets. Their primary objective is to provide attractive and stable returns to their shareholders, mainly in the form of quarterly dividends, by exposing them to a diversified portfolio of real estate credit investments.
