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Investor appetite for commercial properties remains solid so far, despite recent geopolitical instability.
In March, the commercial property marketplace experienced the strongest annual gain in prices since 2022, increasing 2.1% from March 2025, according to MSCI's RCA CPPI U.S. report. The index rose 1.1% quarter-over-quarter.
Investors have an appetite for specific assets, according to the MSCI index.
Suburban office prices saw the largest rise from the year prior, jumping 5.1%, while central business district assets only saw a 1.4% gain. However, both assets had their largest annual gain since the second quarter of 2022. Prices for industrial assets also rose 2.3% over the last year.
Not every asset class’s prices increased, however.
Multifamily prices remained flat in the first quarter, coming off at least three consecutive years of decline. Retail prices slipped 1.2% from the year prior.
Orlando, Florida, San Francisco and Baltimore saw the largest price jumps over the last year. And over the past five years, Miami, Orlando and Baltimore have had the largest positive price changes.
Nashville, Seattle and Southern California's Inland Empire saw the largest price change declines this last year.
The uptick in pricing comes as interest rates have stayed flat over the last two meetings. At the last Federal Reserve meeting in March, the Fed continued its wait-and-see approach to gauge the economic impact of the U.S. immigration crackdown, tariffs and the war in Iran before taking action.
This month, Green Street researchers predicted commercial property prices were unlikely to rise much higher due to the conflict in the Middle East.
And the MSCI report stopped short of predicting future market stability, only saying that investors haven't been scared off yet.
"Commercial property pricing has so far proven resilient against a more uncertain backdrop, with war in the Middle East adding a new layer of caution to the investment environment," the MSCI report says.
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