The economy sent mixed signals in the middle of the second quarter of 2025; most segments of the commercial real estate market have shown resilience.

The outlook remains uncertain, but signs indicate a gradual improvement in some commercial real estate sectors for the remainder of the year.

The full details remain unclear, but commercial real estate is set for improvements in the coming year.

While the Federal Reserve is expected to continue reducing its rates in 2025, the impact of the new administration’s policies is uncertain.

September brought good news for the commercial market as the Federal Reserve eased economic pressures by lowering interest rates by 50 basis points.

With markets already responding to the anticipated rate cut from the Federal Reserve, commercial real estate is also experiencing the effects.

In July 2024, office vacancy rates remained at a record high of 13.8%, retail and industrial fundamentals softened, and demand for apartments surged.

While the market awaits the interest rate cuts from the Federal Reserve, commercial real estate is also on hold.

In May, office vacancy rates remained at a record high of nearly 14%, fundamentals for both retail and industrial sectors weakened.

In Q2 2024, the office vacancy rate reached new record highs, approaching nearly 14%, while fundamentals in retail and industrial sectors decelerated.