With deal volume climbing for the first time in several years and price declines slowing, the commercial property markets turned a corner last year. Every deal structured contributed to this positive trend, although pockets of weakness remain, according to MSCI’s 2024 capital markets report.

The commercial property markets have suffered two related shocks during the past five years. The first was the COVID-19 pandemic, which created uncertainty and diminished tenant demand. Then a sharp decline in commercial property prices started in 2022 as the positive effects of stimulus spending and low interest rates began to wane. Through much of 2024, those declines moderated, MSCI said. The fourth quarter was particularly healthy, with deal volume increasing 32% year over year to close at $130.6 billion. However, that remained lower than an average pre-pandemic quarter when volume averaged $161.9 billion.

Prior to the pandemic, single-asset deals averaged $393.1 billion per year, with the fourth quarter averaging 29% of all annual deal volume at $112.4 billion. Individual asset sales in Q4 2024 were 33% of the market, suggesting liquidity was improving more rapidly to close the year, said MSCI.