7 Commercial Real Estate Trends Set to Shake Up Investment in 2025

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Knowledge is a precious asset in real estate. Identifying the latest trends is one way of increasing it.
The unpredictable world of property development makes control a rare commodity.
Yet the good news for developers is that staying up to speed with commercial real estate trends offers a semblance of certainty.
2024 was a year of cautious optimism in the CRE sector. Signs of recovery started to appear as inflation pressures eased and interest rates were expected to gradually decrease. However, persisting challenges mean we shouldn’t get too excited about record highs for 2025.
Developers can only prepare successfully for the new year by studying the market and anticipating what might play out over the next 12 months.
This report aims to make that easier. We’ve collected the latest insights from a range of industry experts, whose commercial real estate analysis and rankings have helped to paint a clearer picture of what lies ahead of us.
Read on to find out what they think the latest commercial real estate trends are, and how developers can take advantage of them.
Keeping up to date with CRE trends is a smart move, and so is having the right funding. Find out how Duckfund’s Sign Now Pay Later model can help you make your next project a success.
7 commercial real estate trends in 2025 that will define the market
Getting a clear picture of the trends in commercial real estate coming to the fore should be at the top of every CRE developer’s list.
To make this easier, here’s a summary of what’s happening right now in the form of seven key commercial real estate trends.
1. Cautious optimism of a global CRE recovery
The global commercial real estate market is showing signs of recovery in 2025, supported by several key economic trends and improving market conditions.
One of the main factors is improving inflation pressure and interest rate cuts following a turbulent period. Real estate investors feel encouraged to deploy capital with long-term strategic planning in mind under these conditions, resulting in more diversified and resilient portfolios.
This optimism is reflected in Deloitte’s Commercial Real Estate Outlook for 2025, in which they surveyed more than 880 global chief executives of real estate organizations across 13 countries. 88% of them predicted an increase in revenue for 2025, compared with just 34% a year earlier.
Revenue optimism among real estate executives

Source: Deloitte
With optimism comes increased spending, an obvious commercial real estate industry boon. Only 7% of respondents plan to reduce their outlay, compared to 40% last year.
However, caution remains as macroeconomic factors loom large, including cyber risks, tax policy changes, and high capital costs. Interest rates are also expected to remain above pre-pandemic levels, with gradual cuts anticipated through 2025 by the American Federal Reserve, to name one key authority.
Upcoming loan maturities — $600 billion in the U.S. alone for 2024 — are creating refinancing challenges across regions. For instance, Asia-Pacific faces a $257 billion debt maturity coupled with an $8.4 billion funding gap by 2026, according to CBRE, while Europe expects lower but still significant maturities of $165 billion by 2026.
Tax changes, like the global 15% minimum tax and shifts tied to worldwide elections, further complicate long-term commercial real estate strategies.
Despite these headwinds, CRE leaders appear confident that improved conditions will balance cautious optimism with strategic resilience.
2. Multifamily properties and industrial real estate are key asset classes for 2025
With the CRE market showing encouraging signs of growth, there are several key areas that investors and developers should focus on.
The Deloitte report found manufacturing and industrial sector properties to be the chief priority among investors for 2025, leapfrogging digital economy real estate (i.e. data centers), which was 2024’s hot topic.
Key commercial real estate investment areas in 2025

Source: Deloitte
Continued e-commerce growth is the driving force behind this development as businesses prioritize resilient supply chains and seek more warehousing and distribution centers.
Multifamily commercial real estate makes a notable leap into the third spot in the above graphic, up from sixth place in 2024. This type of commercial property is set to benefit from high demand in urban centers for rental housing, driven by both younger adults (aged 20-34) and an increasing number of older renters.
Rising construction costs and financing challenges have slowed multifamily supply growth and lower interest rates may also help revitalize the market.
Rent growth, especially in Sunbelt regions, is also a key factor, and has pushed up the prospects of all kinds of multifamily investments, from student housing to high-income apartments, according to PwC.
The rising demand for several multifamily property types

Source: PwC
3. Green building momentum: Meeting environmental demands in a changing market
Sustainability is one of several commercial real estate trends poised to reshape investment strategies and operational priorities in 2025.
Investors and developers are increasingly looking at sustainable practices to meet rising environmental, social, and governance (ESG) demands.
In the United States of America, examples of this include deep energy retrofits and green buildings which help to reduce carbon footprint and comply with tough new regulations like the SEC’s climate disclosure rules and local initiatives such as New York’s Local Law 97.
One prominent example is Galvanize Climate Solutions, which will spend nearly $2 billion over a three-year period “greening U.S. commercial real estate”, to the point where owner Tom Steyer believes it will help create a whole new asset class.
“We see this as not just a straight opportunity for energy efficiency and reduced energy costs," Steyer told Reuters. "We also see it as potentially a way to create (an) asset class of net-clean buildings that doesn't really exist in the United States."

Energy-efficient buildings are emerging as a cornerstone of this trend as they help meet carbon caps and keep energy usage down. Going even further, this includes upgrading outdated systems with advanced HVAC and lighting solutions.
CRE leaders are also focusing on smart technology for energy management and green financing programs to balance environmental targets with financial goals so that they can keep up long-term resilience and profitability in a competitive market.
4. Data centers: The backbone of the digital economy
We have seen how the digital economy is top of investor priorities for the upcoming year with 77% of CRE experts advising investors to buy them in 2025 in PwC’s research. Data centers appear to be the rocket power behind this.

Source: PwC
Fueled by the rise of artificial intelligence (AI), cloud computing, 5G, and the Internet of Things (IoT), the demand for these high-tech facilities is continuing to rise.
This growth, however, is met with supply constraints, primarily due to the enormous power requirements and limited available sites, which means one thing: big opportunities for landlords and developers.
Data centers host critical infrastructure for everything from AI training to cryptocurrency mining, making them indispensable for modern enterprises.
“Data centers are mission-critical facilities that play a crucial role in the operations and success of the technology behind virtually every business and smart device,” says John Regan, CIO at Aphorio, an infrastructure investment firm “As companies increasingly rely on digital infrastructure to drive their revenue-generating operations, the importance of data centers has never been more evident.”
Despite their profitability, the centers face unique challenges. These include environmental concerns, such as high energy consumption and water usage, and growing legislative hurdles in areas like Loudoun County, Virginia—a global hub where 70% of internet traffic passes through.
Top markets for data centers are defined by factors like fiber connectivity, proximity to population centers, and government incentives. However, power constraints in leading regions like Silicon Valley and Northern Virginia mean emerging markets are gaining traction, according to PwC.
Developers are even turning to unconventional solutions, such as reopening decommissioned nuclear plants, to meet the insatiable energy demands.
The financial outlook for data centers remains strong, with global capacity expected to double by 2029. Investment interest is surging, with 97% of CRE investors planning to increase allocations in 2024.
The sector’s long leases and creditworthy tenants ensure high returns, making it a priority for both REITs and private investors.
5. Office properties continue to suffer but could be about to turn the corner
One of the commercial real estate market trends that have dominated headlines since the pandemic in recent months is the downfall of office space fueled by the remote work boom.
Unfortunately for remaining office owners, this lean spell has persisted throughout 2024 and respondents to the Deloitte survey were the least optimistic about fundamentals for the office sector.
This pessimism is linked to subdued expectations for increased transaction volumes, persistently high vacancy rates, and the rising costs of borrowing.
Office spaces fare the worst in expectations across property sectors

Source: Deloitte
The rationale behind this thinking appears to be motivated by office vacancy rates exceeding 20% nationwide, according to PwC, with even lower occupancy levels in tech-heavy cities like San Francisco and Seattle, and overbuilt markets such as Austin and Denver.
Businesses are also scaling back on office buildings, with plans to shrink their footprints by 20–25% over the next five years. Meanwhile, tenants are showing a clear preference for high-quality Class A properties that feature modern amenities and environmentally friendly designs.
Yet, there are green shoots appearing. Some economists anticipate a market bottom by 2025, potentially setting the stage for recovery.
Urban downtowns are also evolving, with cities prioritizing residential, retail, and entertainment spaces over traditional office use. This reflects broader trends favoring "live" and "play" elements in urban centers, driven by changing work patterns and efforts to revitalize urban cores.
The challenge for office owners, then, will be to reconfigure spaces to meet this new demand.
6. Senior housing boom
Senior housing is set to be a key trend in commercial real estate (CRE) for 2025, driven by the rapidly growing population of older adults in developed countries, especially baby boomers.
As this demographic, which controls a significant portion of the wealth in the Western world, continues to expand, demand for senior housing is increasing, yet the supply is struggling to keep up.
In the US alone, the over-70 group is set to increase by 15 million over the next decade.
How over-70s are one of the key drivers of US population growth

Source: PwC
This creates an opportunity for innovation in the real estate sector, particularly in middle-market housing, which serves a large portion of seniors with fewer affordable options.
Developers are focusing on new models such as active adult communities and niche housing, including LGBTQ+ and culturally focused senior living options. There’s also a growing need for diverse properties within the senior housing market, including special memory care facilities and intergenerational communities where younger generations can connect with seniors.
Repurposing underused retail spaces into senior housing is gaining traction as developers look at fresh ways to meet this demand.
Indeed, senior housing is second only to data centers when it comes to both investment and development prospects for the year ahead, making it a critical area for CRE focus and growth in 2025.
How senior housing trails only data centers in hot commercial property prospects

Source: PwC
7. Construction costs are set to be a key challenge
Construction costs are expected to remain high through 2025 due to several key factors, with increased material and labor costs at the top of the list.
This trend stems from ongoing challenges such as supply chain disruptions, tariff impacts, and natural disasters, which can cause demand shocks, particularly for essential materials like plywood and steel.
PwC notes that labor costs and availability are at the top of real estate company lists of concerns going into 2025.
Top real estate development issues for 2025

Source: PwC
.As construction activity rebounds and backlogs from earlier years are addressed, the sector will face cost hikes ranging from 5-7% in the US, according to JLL’s 2025 U.S. Construction Outlook Inflationary pressures and global policy changes are other factors at play.
Labor costs are another critical component of this upward trend. The construction industry is grappling with ongoing worker shortages, made worse by changing immigration policies in major construction markets like the U.S.
The industry is seeing an increased demand for skilled workers, particularly in specialized sectors like data centers, healthcare, and green building projects, according to Deloitte’s Engineering and Construction Industry Outlook for 2025.
Given these factors, companies are likely to see continued cost escalations unless there are significant shifts in global trade or labor market dynamics.
Commercial real estate trends for 2025: Key shifts reshaping the market
The commercial real estate (CRE) market in 2025 is poised for a dynamic year shaped by key opportunities and challenges.
Economic recovery signals cautious optimism, as declining inflation and gradual interest rate cuts encourage investment and strategic diversification. Multifamily and industrial properties are emerging as top asset classes in this recovery, driven by rental demand in urban centers and the rise of e-commerce.
Sustainability initiatives, such as green building retrofits and energy-efficient designs, are becoming even more critical as ESG compliance tightens and reshapes development projects.
Data centers remain indispensable amid digital transformation, while the senior housing sector sees a boom due to aging demographics and creative repurposing of retail spaces.
However, investors and developers should be aware of potential pitfalls. High construction costs and labor shortages remain big hurdles, along with challenges in an office sector struggling to adapt to the remote/hybrid work phenomenon. Adaptive reuse strategies may offer a path forward here.
In 2025, success in the commercial real estate sector will hinge on adaptability and creative problem-solving. Developers who achieve this will be best placed to seize the new opportunities that the year will bring.
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Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.
Sign Now, Pay Later with Fast Soft Deposit Financing
Discover how Duckfund can help you secure prime commercial real estate quickly, close multiple deals at once, and rapidly grow your CRE portfolio. Only pay the soft deposit when you are ready to close the deal. Apply for fast CRE funding now. We'll get back to you within 24 hours.