Commercial Real Estate Market Size
| Study Period | 2020 - 2029 |
| Base Year For Estimation | 2023 |
| CAGR | 4.00 % |
| Fastest Growing Market | North America |
| Largest Market | Asia-Pacific |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Commercial Real Estate Market Analysis
The size of commercial real estate market is USD 13.5 trillion in the current year and is anticipated to register a CAGR of over 4% during the forecast period. China and Canada experienced growth in office space absorption, whereas Europe and the US saw declined rate. In addition, Asia-Pacific is leading in retail sales and logistics warehouse absorption in the global market.
- The COVID-19 pandemic severely affected the commercial real estate sector, as travel restrictions and social distancing involved public mobilization, commercial works, and gathering facilities. The office, retail, and hospitality sectors were the most affected market segments during the pandemic. Furthermore, the global market is recovering as COVID-19 protocols are relaxed, and sales are reaching pre-pandemic levels.
- The significant commercial real estate market growth is leveraged by urbanization, the commercial sector digitalization, and increasing foreign investments. For instance, in 2021, foreign investments in the European commercial real estate market accounted for half of the capital investments in that region, which is almost EUR 130 million (USD 137 million)
- Many factors influence the development of the commercial real estate industry. Commercial real estate is, by definition, closely tied to the economy and the performance of various sectors.
- There are different types of companies in the industry, such as real estate investors, developers, brokers, managers, media portals, and everyone who faces other challenges and opportunities as industry trends develop.
- During the coronavirus pandemic, the need for social distancing caused offices worldwide to move to a hybrid work model, reducing demand for office space. Meanwhile, increasing e-commerce spending in many countries is leading and driving the need for more warehouses, fulfillment centers, and growth in the industrial and logistics real estate sector, which is paramount to the industry's future.
- Some of the critical issues are the growing importance of technological innovation and environmental, social, and governance (ESG) sustainability.
Commercial Real Estate Market Trends
This section covers the major market trends shaping the Commercial Real Estate Market according to our research experts:
Office Markets to Witness Increased Growth
The office market was strongly hit by the pandemic globally. Despite the vast disruption, now the market is in the recovery phase. Furthermore, increasing investments in the sector are boosting the economic recovery in the market.
In 2021, office occupancy experienced robust growth of more than 80% in almost 390 metro cities worldwide. Moreover, 30 million sq ft (MSF) of office space was absorbed since the third quarter of 2021. Meanwhile, the rental growth of the sector is in the slow recovery phase, and EMEA experienced significant growth in rental growth. In addition, most of the office space is absorbed by class-A offices with more than 61%, followed by class-B and class-C offices with 32% and 7%, respectively.
Furthermore, the Asia-Pacific (APAC) region is leading in the office market due to population growth, GDP growth, middle-class consumers, and the working-age population leveraging office demand. Also, the APAC region contributes more than 50% of office construction in the global market.
The Retail Sector is Likely to Witness a Significant Growth
Despite the COVID-19 pandemic disruption, the retail real estate sector saw significant growth, leveraged by the digitization of work, the transformation of physical retail, and the shift towards environmental, social, and governance (ESG) considerations. Moreover, the retail sector faced many challenges from the e-commerce sector and changing customer behavior during the pandemic.
Despite these challenges, the sector stood resilient, as e-commerce sales during the pandemic accounted for only 14% of overall retail sales. Moreover, developers are focusing on different strategies to meet consumer demand and adapt to the changing retail environment. Such as remodeling shopping centers for multiple purposes, customizing tenant mix, and developing new lease models to attract the latest business models. In addition, to meet consumer demand, some retailers are expanding their business through omnichannel strategies, such as click-and-collect, curbside pickup, and ship-from-store, by adopting new technologies.
Furthermore, retail sales increased in the Asia-Pacific region, followed by the US and Europe. Also, retail sales experienced growth in different segments such as in-store retails, grocery stores, apparel, departmental stores, restaurants, and bars.
Commercial Real Estate Industry Overview
The global commercial real estate market is highly competitive and fragmented, with many players. Most players are expanding their business by investing strategically in partnerships, acquisitions, etc. The office, retail, and logistics sectors are the market's most invested segments. Furthermore, the investments in the market are driven by robust office space take-up, declining vacancy levels, and rising rentals despite the disruption caused by the pandemic. Some major companies are Brookfield Asset Management Inc., Prologis Inc., Boston Properties Inc., WANDA Group, etc.
Commercial Real Estate Market Leaders
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Brookfield Asset Management Inc.
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Prologis, Inc.
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SIMON PROPERTY GROUP, L.P.
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SHANNON WALTCHACK, LLC.
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WANDA Group
*Disclaimer: Major Players sorted in no particular order
Commercial Real Estate Market News
- November 2022 - Colliers CAAC, a regional holding company, currently holding exclusive sublicenses for Central America, the Caribbean, and certain Andean countries from Colliers International announced the acquisition of a Costa Rican real estate consultancy.
- October 2022 - M&G Plc's real estate division acquired a prime office building in Yokohama for more than USD 700 million as the company continues to expand its portfolio in Japan. M&G Real Estate purchased the 21-story Minato Mirai Center Building on behalf of the company's M&G Asia Property Fund.
Commercial Real Estate Market Report - Table of Contents
1. INTRODUCTION
- 1.1 Study Deliverables
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS AND DYNAMICS
- 4.1 Market Overview
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4.2 Market Dynamics
- 4.2.1 Market Drivers
- 4.2.2 Market Restraints
- 4.2.3 Market Opportunities
- 4.3 Supply Chain/Value Chain Analysis
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4.4 Industry Attractiveness- Porter's Five Forces Analysis
- 4.4.1 Threat of New Entrants
- 4.4.2 Bargaining Power of Buyers/Consumers
- 4.4.3 Bargaining Power of Suppliers
- 4.4.4 Threat of Substitute Products
- 4.4.5 Intensity of Competitive Rivalry
- 4.5 Impact of COVID-19 on the Market
5. MARKET SEGMENTATION
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5.1 By Type
- 5.1.1 Offices
- 5.1.2 Retail
- 5.1.3 Industrial/Logistics
- 5.1.4 Multi-family
- 5.1.5 Hospitality
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5.2 By Geography
- 5.2.1 Asia-Pacific
- 5.2.1.1 China
- 5.2.1.2 Japan
- 5.2.1.3 India
- 5.2.1.4 South Korea
- 5.2.1.5 Rest of Asia-Pacific
- 5.2.2 North America
- 5.2.2.1 United States
- 5.2.2.2 Canada
- 5.2.3 Europe
- 5.2.3.1 United Kingdom
- 5.2.3.2 Germany
- 5.2.3.3 France
- 5.2.3.4 Russia
- 5.2.3.5 Rest of Europe
- 5.2.4 Middle-East and Africa
- 5.2.4.1 Saudi Arabia
- 5.2.4.2 United Arab Emirates
- 5.2.4.3 Qatar
- 5.2.4.4 South Africa
- 5.2.4.5 Rest of Middle-East and Africa
- 5.2.5 Latin America
- 5.2.5.1 Brazil
- 5.2.5.2 Mexico
- 5.2.5.3 Argentina
- 5.2.5.4 Colombia
- 5.2.5.5 Rest of Latin America
6. COMPETITIVE LANDSCAPE
- 6.1 Overview (Market Concentration and Major Players)
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6.2 Company Profiles
- 6.2.1 Brookfield Asset Management Inc.
- 6.2.2 Prologis Inc.
- 6.2.3 Simon Property Group LP
- 6.2.4 Shannon waltchack LLC
- 6.2.5 DLF Ltd
- 6.2.6 Boston Properties Inc.
- 6.2.7 Segro
- 6.2.8 Link Asset Management Limited
- 6.2.9 Wanda Group
- 6.2.10 Onni Contracting Ltd
- 6.2.11 MaxWell Realty
- 6.2.12 ATC IP LLC
- 6.2.13 Nakheel PJSC
- 6.2.14 RAK Properties*
- *List Not Exhaustive
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
8. APPENDIX
** Subject To AvailablityCommercial Real Estate Industry Segmentation
Commercial real estate (CRE) refers to property for business-related purposes or to provide a workspace rather than a living space. The report covers segmentation by Type (Offices, Retail, Industrial/Logistics, Multi-family, and Hospitality) and by Geography (Asia-Pacific, North America, Europe, Middle-East and Africa, and Latin America). The report offers market size and forecasts for the commercial real estate market in value (USD billion) for all the above segments. The report also covers the impact of COVID-19 on the market.
| By Type | Offices | |
| Retail | ||
| Industrial/Logistics | ||
| Multi-family | ||
| Hospitality | ||
| By Geography | Asia-Pacific | China |
| Japan | ||
| India | ||
| South Korea | ||
| Rest of Asia-Pacific | ||
| By Geography | North America | United States |
| Canada | ||
| By Geography | Europe | United Kingdom |
| Germany | ||
| France | ||
| Russia | ||
| Rest of Europe | ||
| By Geography | Middle-East and Africa | Saudi Arabia |
| United Arab Emirates | ||
| Qatar | ||
| South Africa | ||
| Rest of Middle-East and Africa | ||
| By Geography | Latin America | Brazil |
| Mexico | ||
| Argentina | ||
| Colombia | ||
| Rest of Latin America |
Commercial Real Estate Market Research FAQs
What is the current Commercial Real Estate Market size?
The Commercial Real Estate Market is projected to register a CAGR of greater than 4% during the forecast period (2024-2029)
Who are the key players in Commercial Real Estate Market?
Brookfield Asset Management Inc., Prologis, Inc., SIMON PROPERTY GROUP, L.P., SHANNON WALTCHACK, LLC. and WANDA Group are the major companies operating in the Commercial Real Estate Market.
Which is the fastest growing region in Commercial Real Estate Market?
North America is estimated to grow at the highest CAGR over the forecast period (2024-2029).
Which region has the biggest share in Commercial Real Estate Market?
In 2024, the Asia-Pacific accounts for the largest market share in Commercial Real Estate Market.
What years does this Commercial Real Estate Market cover?
The report covers the Commercial Real Estate Market historical market size for years: 2020, 2021, 2022 and 2023. The report also forecasts the Commercial Real Estate Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
What are the key market trends in the Commercial Real Estate Market?
The key market trends in the Commercial Real Estate Market are a) Increasing number of flexible office space providers offering coworking and short-term lease options b) Continuous advances in technologies such as smart building systems, IoT sensors, and digital tenant services
What are the segments covered in the Commercial Real Estate Market by Application and Size?
The segments covered in the Commercial Real Estate Market by Application and Size include a) Application: Leasing, Investment b) Size: Small, Medium and Large
Commercial Real Estate Industry Report
The global commercial real estate market is experiencing significant growth, driven by various factors across different segments and regions. The market is segmented into types such as rental and sales, with rental being the dominant segment due to the increasing demand for office spaces, retail outlets, and industrial facilities by expanding businesses and startups. In terms of end-use, offices hold the largest market share, reflecting the ongoing need for functional and well-designed spaces for business operations. Geographically, the Asia Pacific region leads in market share, propelled by rapid urbanization, economic growth, and infrastructure development, which boosts demand for commercial spaces.
Key trends influencing the market include the rise of remote work culture, technological advancements like smart building systems and IoT, and a growing emphasis on sustainability and flexible workspaces. The commercial real estate market offers substantial opportunities through technological integration and strategic real estate developments to cater to evolving consumer and business needs.
This commercial real estate industry overview highlights the dynamic nature and robust potential of the market, underpinned by detailed commercial real estate industry analysis and insights into the commercial real estate market size, trends, and statistics. The industry outlook is positive, with market predictions indicating continued growth. Industry research shows that market segmentation will play a crucial role in understanding the diverse needs of different sectors.
The market forecast suggests that the industry will continue to expand, driven by market growth in key regions. Market data points to significant contributions from market leaders who are setting trends in the industry. The market review emphasizes the importance of industry trends and industry statistics in shaping the future of the commercial real estate sector.
For those interested in detailed analysis, a market report or report pdf can provide comprehensive insights. Research companies are actively exploring new opportunities and market value propositions within this evolving landscape. The industry size is expected to grow as more businesses seek modern, sustainable, and technologically advanced commercial spaces.
