Offices Under Pressure, Warehouses and PRS Benefit: Key Real Estate Trends 2025–2026

The global office market is entering its most challenging phase in over a decade. According to data from Trepp, delinquencies on office-backed CMBS loans^[1] reached 11.31% by the end of 2025, after an earlier peak of 11.76%. More than 1.7 trillion dollars in commercial mortgage loans mature between 2024 and 2028^[2]. A high office vacancy rate, which stood at 18.4% in December 2025 according to Globe. St, coincides with costly refinancing needs. Some lenders are extending financing under an “extend and pretend” approach, avoiding immediate recognition of losses, which postpones but does not eliminate the risk of restructuring and property takeovers.

Offices: Record Defaults and Debt

The main cause of office troubles remains the lasting prevalence of hybrid and remote work alongside rising capital costs. A significant share of tenants maintain long-term leases signed before 2020, while about half of employees actually use offices less frequently than before the pandemic. Estimates cited by Moody’s may exceed 250 billion dollars^[4] if vacancy rates rise to 24% by 2026. Cities are facing declines in property tax revenues – New York by about 1.5–1.7%, and Washington expects an 11.7% drop in 2026. Governments and local authorities in the US and EU are boosting support for office-to-residential conversions, which is becoming a key scenario for class B and C buildings.

Polish PRS: Breakthrough Resi4Rent Sale

Amid office struggles, the Polish institutional rental housing market stands out. Echo Investment and Griffin Capital Partners signed^[6] in August 2025 a preliminary agreement to sell the Resi4. Rent portfolio to Vantage Development, part of the Hamburg-based TAG Immobilien group. The deal value is 565 million euros, approximately 2.405 billion zlotys, marking a record sale in the Polish rental housing market. The portfolio covers 5,322 units in 18 projects located in six cities: Warsaw, Kraków, Gdańsk, Wrocław, Łódź, and Poznań. Forecasted net operating income (NOI) yield for 2026 is 6.3%, and net rental income (NRI) yield 6.8%, significantly above typical prime PRS rates in Western Europe of 3–4.5%.

Warehouses and Logistics in the USA

Echo Investment states that sale of the portfolio will reduce debt and free up funds^[9] for new projects and shareholder payouts, while maintaining about 4,500 PRS units, roughly 3,800 of which are expected to remain operational by 2026. Vantage Development accelerates its portfolio growth toward 10,000 rental apartments thanks to this acquisition. The transaction, pending approval from the Polish antitrust authority, confirms strong institutional capital interest in Central and Eastern European markets and may catalyze further consolidation of Poland’s PRS segment. At the same time, risks of future regulatory interventions, such as potential rent caps or financing restrictions, remain scenarios under observation.

The US warehouse sector is entering a rebalancing phase. Industry analyses indicate that net absorption of logistics space will reach around 200 million square feet in 2026^[10], up from 155 million in 2025, with vacancy rates dropping from about 7.4% to 7.1–7.2%. New supply is limited, and the highest demand focuses on infill and last-mile facilities along with specialized warehouses and manufacturing halls tied to nearshoring. Strengthening supply chains and production relocation under the USMCA agreement are increasing demand for space near border crossings and intermodal hubs. Meanwhile, the data center market is growing dynamically – transactions worth at least 100 million dollars rose by 51% year-over-year in November 2025, and the sales volume for that month exceeded 615 million dollars.

Capital Returns to European Prime Offices

The European prime office market shows a slow recovery. Reports from firms such as Cushman & Wakefield, Savills, PMA, and BNP Paribas Real Estate indicate the average capitalization rate for top offices in Europe^[14] dropped by 5 basis points to 4.96% in Q2 2025. In Q3, prime cap rates were around 4.0% in Paris’s central business district, 4.0–5.0% in London, and 4.0–4.4% in Frankfurt, Amsterdam, and Munich. A global investor survey by Knight Frank shows about 87% of institutions plan to increase real estate exposure, with expected new capital inflows of 144–150 billion dollars in 2026. Around 62% of respondents anticipate being net buyers, while only 12% plan to be net sellers. The main drivers are declining interest rates, cited by 54% of participants, and expected rent growth in locations like London West End (+10.3%), London City (+9.9%), and Paris (+6.1%) between 2025 and 2027.

Weaker Signals and Data Gaps

Beneath the main trends, weaker signals emerge that could gain importance in coming years. The European Central Bank maintains the deposit rate at 2.0%^[3] with prospects for stabilization in 2026, while new mortgage rates in the UK hover around 3.3%, creating a “rate ceiling” effect on housing demand. Poland experiences delays in passing the Investment Companies for Rental Housing (SINN) law, slowing domestic REIT development and potentially limiting PRS scaling. Meanwhile, investments rise in the hospitality and medical sectors – exemplified by a portfolio worth 7.2 billion dollars acquired by the Welltower fund – and the growing importance of ESG standards and building energy efficiency norms, strengthened by new certification systems and regulations on energy performance.

The report for the period up to the end of January 2026 was based on multiple confirmed data points from reports by Moody’s, CBRE, Trepp, Cushman & Wakefield, Savills, Knight Frank, as well as corporate releases from Echo Investment, Griffin Capital Partners, and TAG Immobilien. The largest informational gaps concern current transaction databases as of January 2026, detailed data on lease renegotiations in Central and Eastern Europe, and the full impact of tariffs on construction costs. The certainty level of main trend assessments is estimated at around 90%, with weaker signal confidence between 70–85%. The next data and regulation review is scheduled for the second half of February 2026.

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