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Despite the uncertainty surrounding the market, commercial real estate performed well overall in 2022. With healthy balance sheets, consumer demand was boosted significantly in retail and industrial asset classes. In both of these sectors of the real estate market, vacancy rates fell even further than the previous year, illustrating strong demand for retail and industrial spaces in the post-pandemic period. Specifically, the retail sector experienced the largest drop in vacancy rates to 4.2% at the end of 2022. Due to a lack of new supply, net absorption and rent price gains were substantial in the retail sector.

However, this year will be challenging for most commercial real estate market sectors, with higher vacancy rates in the office and multifamily sectors.