MarketSnapshot: Single-Tenant Office

The single-tenant office sector posted $3.9 billion in fourth quarter sales volume, up 54.1% from the third quarter and 48.1% year-over-year. Cap rates edged higher, rising 4 basis points to 7.35%, up 16 basis points year over year.

The West region dominated transaction activity in the fourth quarter, recording $1.7 billion in volume and accounting for 43.4% of the total. The Southeast followed with $647.6 million, representing 16.8% of overall volume. The Northeast ranked third with $628.4 million, or 16.3%, while the Midwest recorded $407.0 million, representing 10.6%. The Southwest contributed $330.5 million, or 8.6% of total volume, and the Mid-Atlantic region trailed with $166.9 million, accounting for 4.3%.

By region, cap rates ranged from a low of 6.50% in the West to a high of 8.43% in the Mid-Atlantic. Cap rates were mixed across all regions. Average cap rates are up 127 basis points from the recent low of 6.08% recorded in the first quarter of 2022.

Private buyers accounted for 52% of single-tenant office acquisitions through the fourth quarter of 2025, followed by institutional investors at 25%. The private share increased sharply by 23% from 2024, while institutional investment activity increased by 6% over the same period. REIT/Listed acquisitions fell from 26% of investment activity in 2024 to just 4% as of the fourth quarter of 2025.