What Changed?
The office narrative is getting less catastrophic on the surface. Vacancy edges down, leasing improves, and rents are no longer falling in nominal terms.
But the real change is happening behind the glass: the cycle is moving from “usage” to “financing.” Remote first work patterns still limit how much space companies truly need, which turns every lease renewal into a repricing moment. At the same time, a large share of commercial mortgages rolls into 2025 maturities, forcing valuations to clear at higher rates and tighter lender terms. The reckoning is less about empty desks and more about whether yesterday’s buildings can carry tomorrow’s capital.
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The Numbers
U.S. office vacancy: 18.8% in Q3 2025; prime vacancy: 14.2% versus nonprime: 19.1%.
Leasing activity: 59.8 million square feet in Q3 2025; net absorption: +16 million square feet.
Average asking rent: $36.40 per square foot, up 1.3% year over year, but 18% lower than Q1 2020 after inflation.
Maturities: 20% ($957 billion) of $4.8 trillion in outstanding commercial mortgages mature in 2025.
Office maturities: 24% of office property loans come due in 2025.
CMBS stress: overall CMBS delinquency rate 7.30% in December 2025; office CMBS delinquency rate 11.31%.
Bank and thrift stress: 1.27% (90 plus days delinquent or nonaccrual) in Q3 2025.
Why It Matters
Lease repricing is not uniform. The data show occupiers favoring prime space, which helps the best buildings but leaves a larger share of inventory competing on concessions and flexibility. For corporate tenants, that creates negotiating power in older stock and stickier costs in top tier buildings, where “right sizing” often means paying up for fewer, better square feet.
Refinancing is where the market stops being theoretical. A building can look stable while cash flow slowly softens, but a maturity date forces a hard decision: refinance with fresh equity, accept a modified loan, or sell into a thinner buyer pool. That is why the maturity stack matters as much as vacancy prints. It converts slow moving fundamentals into fast moving credit outcomes.
Credit signals are already diverging by channel. Bank reported delinquency remains comparatively low, while securitized office is carrying much higher late payment rates. For investors, that dispersion is the point: price discovery tends to start where workout flexibility is lowest and then spreads through comparable sales and appraisal marks. The risk is not that every lender panics at once, but that incremental refinancings reset valuations lower building by building.
Takeaway
Corporate real estate is not facing a single crash. It is facing a rolling audit, where each lease reset and each refinancing answers the same question: is this asset still financeable in a remote first economy with higher capital costs. In 2026, the quiet signal to watch is not occupancy alone, but how many maturities clear without new equity.
— Lauren Brown
Editor, American Ledger
Sources
CBRE, October 2025 https://www.cbre.com/insights/figures/q3-2025-us-office-figures
Mortgage Bankers Association, February 2025 https://www.mba.org/news-and-research/newsroom/blog-post/chart-of-the-week--commercial-real-estate-loan-maturity-volumes
Mortgage Bankers Association, December 2025 https://www.mba.org/news-and-research/newsroom/news/2025/12/04/commercial-and-multifamily-mortgage-delinquency-rates-mixed-in-third-quarter-2025
Trepp, December 2025 https://www.trepp.com/trepptalk/cmbs-delinquency-rate-inches-back-up-in-december-but-office-retreats-again
Federal Reserve, November 2025 https://www.federalreserve.gov/publications/files/financial-stability-report-20251107.pdf