U.S. asking rents are forecast to grow 2.5% year over year for a few quarters, then accelerate past 3% toward late 2027.
CoStar Group forecasts U.S. office rents to grow 2.5% YoY, accelerating to over 3% by late 2027. Net absorption expected at 20M sq ft in 2026 and 9M sq ft in 2027, up from prior estimates. Phil Mobley attributes this to supply-side adjustments and slowed new construction, despite high vacancy rates. Risks include inflation, interest rates, and AI-driven productivity gains.
How this was made
The 30-second read
Why it matters
It updates the expected path of office rent growth (slow-but-steady near term, accelerating later) and frames the drivers as supply-side adjustments and slowed construction, while warning that inflation and higher rates could worsen demand.
Market read
Traders may use the forecast as a read-through for office-market stabilization versus continued demand fragility, but it is not a company-specific financial catalyst.
What to watch
The forecast explicitly flags larger downside magnitude from persistent inflation and higher rates, plus potential AI-driven productivity effects that could reduce demand for certain knowledge-worker roles.
Background
The piece summarizes CoStar Group’s updated U.S. office market outlook, including vacancy, net absorption, and asking-rent growth trajectories.
Ticker impact
CoStar Group’s office analytics forecast upgrades U.S. asking-rent growth outlook, citing supply slowdown and weaker demand, which can affect investor sentiment toward its analytics business.
Likely limited near-term stock impact, with any reaction tied to how markets interpret office-market stabilization versus ongoing demand risk.
The release provides forecast numbers and a management quote, but it is not a financial results print, guidance update, or contract/transaction; impact is therefore mostly sentiment and sector read-through.
Market effects
Improved office rent growth expectations can modestly support sentiment for office landlords and commercial real estate credit, while vacancy and demand risks remain.
National forecast may influence regional office-market pricing and underwriting assumptions, but the article does not break out metro-level data.
Limited direct global linkage; it mainly informs U.S. commercial real estate expectations and related data/analytics demand.
Counterpoint
Stronger asking-rent projections may reflect constrained supply in desirable buildings rather than durable demand recovery, so equity and credit risk could remain elevated.
Key entities
- companyCoStar Group
Provider of commercial real estate data and analytics; its office analytics team issued an upgraded forecast for U.S. office asking rents and related metrics.
