Retail properties had the highest capitalization rates in the United States in 2023, followed by offices. The cap rate for office real estate was **** percent in the fourth quarter of the year and was forecast to rise further to **** percent in 2024. Cap rates measure the expected rate of return on investment, and show the net operating income of a property as a percentage share of the current asset value. While a higher cap rate indicates a higher rate of return, it also suggests a higher risk. Why have cap rates increased? The increase in cap rates is a consequence of a repricing in the commercial real estate sector. According to the National NCREIF Property Return Index, prices for commercial real estate declined across all property types in 2023. Rental growth was slow during the same period, resulting in a negative annual return. The increase in cap rates reflects the increased risk in the investment environment. Pricing uncertainty in the commercial real estate sector Between 2014 and 2021, commercial property prices in the U.S. enjoyed steady growth. Access to credit with low interest rates facilitated economic growth and real estate investment. As inflation surged in the following two years, lending policy tightened. That had a significant effect on the sector. First, it worsened sentiment among occupiers. Second, it led to a decline in demand for commercial spaces and commercial real estate investment volumes. Uncertainty about the future development of interest rates and occupier demand further contributed to the repricing of real estate assets.

Dollar stores with single tenant net leases in the United States had an average cap rate of 7.34 percent as of the fourth quarter of 2024. That made them the property type with the second-highest cap rate. Conversely, convenience stores had a cap rate of 5.5 percent, the lowest among the property types observed. Triple net leases (NNN) are single tenant leases, where in addition to rent and utilities, the tenant is responsible for the additional property expenses, including taxes, insurance, and maintenance. These leases are common for office, retail, industrial, and logistics properties.

The cap rate for industrial and logistics real estate in the United States grew in 2023, after hitting a record-low in 2023. In the fourth quarter of 2023, the cap rate was **** percent and by the end of 2026, it was forecast to decline to **** percent. Cap rates measure the expected rate of return on investment properties and are calculated by dividing the net operating income of the property by the current asset value. While a higher cap rate indicates a higher rate of return, it is also associated with higher risk, such as declining property values.

Commercial valuation data collected and maintained by the Cook County Assessor's Office, from 2021 to present. The office uses this data primarily for valuation and reporting. This dataset consolidates the individual Excel workbooks available on the Assessor's website into a single shared format. Properties are valued using similar valuation methods within each model group, per township, per year (in the year the township is reassessed). This dataset has been cleaned minimally, only enough to fit the source Excel workbooks together - because models are updated for each township in the year it is reassessed, users should expect inconsistencies within columns across time and townships. When working with Parcel Index Numbers (PINs) make sure to zero-pad them to 14 digits. Some datasets may lose leading zeros for PINs when downloaded. This data is property-level. Each 14-digit key PIN represents one commercial property. Commercial properties can and often do encompass multiple PINs. Additional notes: Current property class codes, their levels of assessment, and descriptions can be found on the Assessor's website. Note that class codes details can change across time. Data will be updated yearly, once the Assessor has finished mailing first pass values. If users need more up-to-date information they can access it through the Assessor's website. The Assessor's Office reassesses roughly one third of the county (a triad) each year. For commercial valuations, this means each year of data only contain the triad that was reassessed that year. Which triads and their constituent townships have been reassessed recently as well the year of their reassessment can be found in the Assessor's assessment calendar. One KeyPIN is one Commercial Entity. Each KeyPIN (entity) can be comprised of one single PIN (parcel), or multiple PINs as designated in the pins column. Additionally, each KeyPIN might have multiple rows if it is associated with different class codes or model groups. This can occur because many of Cook County's parcels have multiple class codes associated with them if they have multiple uses (such as residential and commercial). Users should not expect this data to be unique by any combination of available columns. Commercial properties are calculated by first determining a property’s use (office, retail, apartments, industrial, etc.), then the property is grouped with similar or like-kind property types. Next, income generated by the property such as rent or incidental income streams like parking or advertising signage is examined. Next, market-level vacancy based on location and property type is examined. In addition, new construction that has not yet been leased is also considered. Finally, expenses such as property taxes, insurance, repair and maintenance costs, property management fees, and service expenditures for professional services are examined. Once a snapshot of a property’s income statement is captured based on market data, a standard valuation metric called a “capitalization rate” to convert income to value is applied. This data was used to produce initial valuations mailed to property owners. It does not incorporate any subsequent changes to a property’s class, characteristics, valuation, or assessed value from appeals.Township codes can be found in the legend of this map. For more information on the sourcing of attached data and the preparation of this datase

As of March 2025, grade A offices in core locations in Bengaluru, India, had a median cap rate of around *** percent. In comparison, the median cap rate of grade A offices in core locations in Taipei, Taiwan, was around *** percent as of March 2025.

Multifamily buildings had some of the lowest cap rates in Canada in the first quarter of 2023. For class A multifamily high rise buildings, investors could expect a capitalization rate of 4.04 percent, while for class AA downtown offices, the cap rate was 5.92 percent. The capitalization rate measures the rate of return on commercial properties and is calculated by dividing the net operating income of a property by its asset value. While a higher rate might promise higher return, it is also an indication of a riskier asset.

Cap rates in the U.S. multifamily real estate sector have increased significantly since 2021, reflecting a rise in borrowing costs. In 2023, the average multifamily cap rate was **** percent, up **** percent in 2021, when it was at its low. By 2026, the average multifamily cap rate is forecast to decline slightly, to **** percent.

Amid a worsening economic climate, the value of commercial real estate investment in the U.S. plummeted in 2023, with a mild increase in 2024. According to industry professionals, the biggest factors impacting the real estate industry in 2025 are the rising cost of finance, and declining capital availability. Development of commercial real estate cap rates in the U.S. Cap rates started to increase in 2022, reflecting a decline in property values. According to the forecast, cap rates for commercial real estate are expected to peak in 2024, followed by a steady decline. Cap rates measure the expected rate of return on investment properties and are calculated by dividing the net operating income of the property by the current asset value. While a higher cap rate indicates a higher rate of return, it is also associated with higher risk. Which property type has the best development prospects? In 2025, the development opportunities in the commercial real estate sector deemed the best for single-family real estate. Industrial and distribution real estate, including warehouses, factories, and big box distribution centers, was also ranked high.

The Australia Commercial Real Estate Market Report is Segmented by Property Type (Offices, Retail and More), by Business Model (Rental and Sales), by End User (Individuals / Households, Corporates & SMEs and More) and by Region (New South Wales, Victoria, Queensland and More). The Report Offers Market Size and Forecasts in Value (USD) for all the Above Segments.

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REIT Market Size 2025-2029

The reit market size is forecast to increase by USD 372.8 billion, at a CAGR of 3% between 2024 and 2029.

The market is experiencing significant growth driven by the increasing global demand for warehousing and storage facilities. This trend is fueled by the e-commerce sector's continued expansion, leading to an increased need for efficient logistics and distribution networks. An emerging trend in the market is the rise of self-storage as a service, offering investors attractive returns and catering to the growing consumer preference for flexible and convenient storage solutions. However, the market faces challenges as well. Vertical integration by e-commerce companies poses a threat to the industry, as these companies increasingly control the entire supply chain from production to delivery, potentially reducing the need for third-party logistics and storage providers. Additionally, regulatory changes and economic uncertainties can impact REITs' profitability and investor confidence. Companies seeking to capitalize on market opportunities and navigate challenges effectively must stay informed of these trends and adapt to the evolving landscape.

What will be the Size of the REIT Market during the forecast period?

Explore in-depth regional segment analysis with market size data - historical 2019-2023 and forecasts 2025-2029 - in the full report.
Request Free SampleThe market continues to evolve, with various sectors such as retail, industrial, and commercial real estate experiencing dynamic shifts. Family offices, pension funds, high-net-worth individuals, and sovereign wealth funds increasingly invest in this asset class, seeking diversification and stable returns. Market volatility, driven by economic cycles and interest rate fluctuations, influences investment strategies. Artificial intelligence and property technology are transforming the industry, with data analytics and digital platforms streamlining property management, investment, and appraisal processes. Multifamily housing and single-family homes remain popular choices due to their rental income potential and capital appreciation opportunities. Property taxes, inflation risk, and maintenance costs are essential considerations for investors, requiring effective risk management strategies. Net operating income, return on equity, and occupancy rates are critical performance metrics. Regulatory environment and property regulations also impact the market, influencing capitalization rates and shareholder value. Institutional investors explore equity and debt financing, real estate brokerage, and securities offerings to capitalize on opportunities. Property investment platforms, real estate syndications, and property management companies facilitate access to diverse offerings. Green building standards and sustainable development are gaining traction, attracting socially responsible investors. The ongoing digital transformation of the real estate sector, including smart buildings and hybrid REITs, offers new investment opportunities and challenges. Investors must stay informed of market trends and adapt their strategies accordingly.

How is this REIT Industry segmented?

The reit industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2025-2029, as well as historical data from 2019-2023 for the following segments. TypeIndustrialCommercialResidentialApplicationWarehouses and communication centersSelf-storage facilities and data centersOthersProduct TypeTriple netDouble netModified gross leaseFull servicePercentageGeographyNorth AmericaUSCanadaEuropeFranceGermanyItalyUKAPACChinaIndiaJapanSingaporeRest of World (ROW).

By Type Insights

The industrial segment is estimated to witness significant growth during the forecast period.The retail and industrial real estate sectors dominate the market, with industrial real estate leading in 2024. The industrial segment's growth is driven by the increasing demand for warehousing space due to the surge in e-commerce and online sales during the COVID-19 pandemic. Supply chain disruptions have compelled companies to lease more warehouse space to store additional inventory, leading to increased occupancy and rental rates. Furthermore, the proximity of fulfillment centers to metropolitan areas caters to the growing number of online consumers. This trend will continue to fuel the expansion of industrial REITs, offering significant growth opportunities for the market. Asset management companies, pension funds, and high-net-worth individuals are increasingly investing in REITs for their attractive dividend yields and potential for capital appreciation. Private equity firms and family offices are also active players in the market, providing equity financing for REITs. Real estate agents and brokers facilitate transactions, while debt

The Canadian office real estate market, currently valued at approximately $XX million (assuming a reasonable market size based on comparable markets and the provided CAGR), is experiencing robust growth, projected to maintain a Compound Annual Growth Rate (CAGR) exceeding 8% from 2025 to 2033. This expansion is driven by several key factors. Firstly, the flourishing technology sector in major cities like Toronto, Montreal, and Ottawa is fueling significant demand for modern office spaces. Secondly, increasing urbanization and population growth within these metropolitan areas are contributing to a tightening of the office supply, further pushing rental rates upward. Finally, ongoing investments in infrastructure and a generally positive economic outlook in Canada contribute to a favorable environment for real estate investment. Major players like JLL, Colliers, CBRE Canada, and Avison Young are actively shaping the market dynamics, with significant developments and acquisitions influencing market trends. However, the market is not without its challenges. Rising interest rates and economic uncertainty present potential headwinds, impacting investment decisions and potentially slowing down growth in the short term. Furthermore, the increasing adoption of hybrid work models by many companies could lead to a decrease in overall demand for traditional office spaces, though the extent of this impact remains to be seen. The market's resilience will depend on the ability of developers and landlords to adapt to these evolving workplace trends, embracing flexible lease terms and innovative building designs to attract and retain tenants. The segmentation of the market by major cities highlights the regional variations in growth, with Toronto likely remaining a dominant force due to its established financial and technological hubs. A comprehensive understanding of these dynamic factors is crucial for investors and stakeholders navigating this evolving landscape. Recent developments include: April 2022: Canadian Net Real Estate Investment Trust announced the purchase of four properties in Quebec and Nova Scotia. With transaction fees excluded, the total consideration paid was USD 18, 800,000, which was paid in cash. The purchase price reflects a capitalization rate for the portfolio of about 6.5%., February 2022: The first acquisition for Crown Realty Partners' value-add fund, Crown Realty V Limited Partnership, has been finished. The Park of Commerce property is a group of four office buildings situated along the Queensway Corridor in the Greater Ottawa Area. This purchase is a crucial milestone for their Fund as they optimize sustainability objectives and economic return targets as part of their value enhancement plan.. Notable trends are: Office spaces in Toronto and Vancouver are increasing.

The prime yields in the UK expanded across most property types between 2022 and 2025. In April 2025, yields were the lowest in the London West End offices market at *****percent. In contrast, shopping center yields stood at ****percent. Yield is an indicator for the expected return of a property investment and is calculated as the ratio of rental income and the property value. Several factors can drive yields - increased demand could raise property values, causing lower yields, while a fall in demand could create the opposite effect. Which is the largest commercial real estate sector in the UK? Office real estate has traditionally accounted for the lion’s share of the commercial property investment market, but since the start of the COVID-19 pandemic, investors’ interest has shifted towards industrial real estate. With the e-commerce sector growing and supply chain management becoming more important than ever, so has the industrial and logistic sector. This increase in importance is also reflected in the occupiers market, with the annual take-up exceeding the ten-year average for three years in a row. How is the commercial property market expected to develop in the coming years? The industrial and logistic property market is forecast to outperform retail and offices in terms of capital value growth in the period between 2025 and 2028. According to the same forecast, rental growth is expected to turn positive for all property types in 2025, except for shopping centers.

The infrastructure real estate investment trust (REIT) Prologis was the largest U.S. REIT as of November 2024, with a market cap of almost 105 billion U.S. dollars. In 2024, the price to funds from operation (P/FFO) ratio of Prologis was estimated at 20.77, with 2025 witnessing a slight decline to 19.24. The REITs sector has grown substantially, with the market cap reaching a record high in 2021. After a difficult year of negative returns in 2022, the year-to-date total returns for all property segments returned to positive grounds in 2023.

The market size of the real estate industry in India was valued at around 477 billion U.S. dollars in 2022 and is estimated to reach one trillion dollars by 2030. Real estate industry is forecasted to grow exponentially until 2047.

What is included in the real estate sector?

The real estate sector includes a variety of segments dealing with land and the buildings on it as well as with related resources if necessary. During the development phase of real estate projects, the construction industry is responsible for the realization. The real estate market includes all the sales and investment processes within the sector. Depending on the purpose of the building, the market is made up of the segments residential, office, commercial, or retail real estate. Sometimes housing is even used synonymously for real estate.

Importance of the real estate sector in India

Due to a stable growth in recent years and the variety of segments contributing to it, the real estate sector is perceived to be one of the main drivers for India’s economic development in upcoming years. As the Indian population is comparatively young and urbanization is continuing, the demand for housing is strong. Additionally, the office segment benefits from a strong IT-sector, while the construction-industry is one of the leading industries in India for attracting foreign direct investments. Besides its importance for the Indian market in general, the real estate sector comes second in generating employment after agriculture.

Prime industrial property had the lowest investment yield among different commercial real estate types in Cape Town, South Africa in 2024. Yield measures the expected return of an investment property and is calculated as the annual rental income divided by the property value. Investors expected a return on investment of 8.5 percent for prime industrial properties, while for rental housing this figure was 9.5 percent.

The initial prime yields of office properties in the Île-de-France (Paris) region of France increased for the second consecutive year in 2023. Yields were the lowest in Paris (central business district), at 4.5 percent. Outside of Paris, the region with the lowest office yields was Lyon.