Smaller Metros Increase their Share of CRE Sales Activity

CRE Sales Activity Shifting Across Market Types

• Transaction activity was previously concentrated in primary markets

• The share of transactions in primary markets fell from 60% in the early 2000’s, to 34% by 2022

• Tertiary markets now house most transactions, accounting for almost half of deals

What is Driving Activity in Tertiary Markets?

• Properties often trade for a lower price and provide higher average yields

• Population growth rate has been faster in smaller metros

Will Sales Activity Remain Elevated in Tertiary Markets?

• Current demographic trends favor tertiary markets

• Primary markets would benefit from a return to the office

• Sales activity has increased across all property types