Archive · 2 Sep 2025
US Office Market Shows Signs of Recovery After Years of Turmoil
For years, the US office market struggled because of people working from home and rising interest rates.
This led to many empty office spaces and financial trouble for some banks.
Now, things are slowly starting to get better.
Less new office space is being built, and some offices are being turned into apartments.
Also, new companies are stepping in to lend money since banks are pulling back.
This should help the office market, although it will likely be a slow process.
The US office vacancy rate hit a record high of 20% by the end of June.
Office prices have dropped by half since 2021 and are now as low as in 2010.
8% of commercial-mortgage-backed securities are in delinquency or foreclosure.
Office space is shrinking due to less construction and conversions to housing.
Private credit funds are stepping in to provide mortgages as banks reduce lending.
- Who
- Commercial-property investors, lenders, banks, and private-credit outfits
- What
- A fragile recovery in the US office market
- When
- Beginning in 2022, continuing to 2025
- Where
- United States
- Why
- Working from home, interest rate rises, and banks reducing lending caused the office market to struggle. Dwindling supply and new lenders are helping recovery.
- Vacancy Rate
- 20% (record high)
- Price of Office Space
- As cheap as in 2010
- CMBS Delinquency
- 8% of CMBS secured against office buildings are in delinquency or foreclosure
- Office Construction (2025)
- 13m square feet
- CMBS Bonds Issued (2025)
- $15.2 billion
- Remote Work
- 27% of working days at home in July