What are the Top US Commercial Real Estate Markets?

The Top Commercial Real Estate Markets in the United States

For decades, New York City, Los Angeles, San Francisco, and Chicago dominated the commercial real estate sector. More recently, however, other metro areas have surpassed these major cities to take the top spots.

In 2014, Coldwell Banker Commercial reported that Denver is now the top US CRE market, with San Francisco coming in second and Houston and Dallas taking spots three and four respectively. San Jose, CA ranked fifth and Phoenix, AZ  came in sixth.

To determine the best markets for investors, Coldwell Banker Commercial ranked over 80 cities and metro areas based on their performance Q3 2013 through Q3 2014. The highest weighted factors were the percent changes in vacancy,  rental rates, population, and unemployment.

We’ve detailed 5 of the top cities for CRE to help you discover why they make popular business destinations and strong opportunities for commercial real estate investors.


The Mile-high City ranked first for change in unemployment (over a 35% drop), fourth for retail, eighth for office, and 11th for population, earning it the top spot overall. With more than 600,000 residents and almost 3 million people in the metro area, Denver is the largest city within 500 miles.

This geographical location gives Denver many natural advantages, making it a hub for goods and services across the Rocky Mountain region.


Houston city skyline

Houston’s skyline

For several years, Houston has been one of the nation’s top commercial markets. The Coldwell Banker report ranked Houston’s commercial real estate market third overall, and within the top ten for two other categories: second for multi-family and eighth for population.

Known as a worldwide hub for the oil and natural gas industries, Houston’s location near the Gulf of Mexico makes it ideal for shipping and transportation. With over 2 million residents, it is also the most populous city in Texas and throughout the southern US. Since Texas has no state income tax, it’s attractive to businesses and investors who have a trusted commercial real estate broker.


Ranked fourth overall in the report, Dallas also ranked fourth for population with over 1.3 million residents, 11th for retail and 13th for multi-family. Once a farming and oil town, Dallas has evolved into a major business center with the most shopping centers per capita in the United States and the most billionaires in one US city (17, up from 14 in 2009). Dallas is poised for even more growth due to Toyota and Liberty Mutual’s decisions to relocate to the area.

In response, the city of Dallas plans to add more than 20,000 multifamily-housing units over the coming years. Like Houston, Dallas residents pay no state income tax.

San Jose

San Jose CA skyline

San Jose skyline

Coldwell Banker ranked San Jose, CA fifth overall, jumping nine places (from 14th to 5th) from their previous report. However, the city of almost 2 million took the top spot for multifamily properties, and ranked second for office buildings and sixth for retail properties

In general, the surge in multifamily development helped fill San Jose’s affordable housing needs. Due to the continuing tech boom in the area, San Jose saw the delivery of 1.55 million SF of new office space and 1.78 million SF of net absorption between Q3 2013 and Q3 2014. However, San Jose ranked 60th for population change and growth, experiencing only 0.49% growth.


Coming in sixth overall among commercial real estate markets, this city of 1.6 million ranks fifth for retail properties, 11th for multifamiliy properties, 12th for population growth, and 20th for office buildings. A booming town for business, the Phoenix metro area has experienced low vacancies and modest rent growth, and an expansive highway system links Phoenix and its suburbs.

Yet, the construction pipeline has slowed considerably after several years of expansion. This is surprising in an area that had millions of square feet under construction in previous years.

What will be the next big CRE market?

While these top-ranked cities offer numerous opportunities, investors and developers should also pay attention to which cities are becoming the next big CRE markets. These emerging commercial real estate markets have already caught investors’ attention: 

  • Atlanta Georgia’s capital and largest city has seen strong job growth spurred by technology, research and development and a relatively moderate cost of living.

    Several Buildings of the Houston skyline from Tinsley Park

  • NashvilleThe Music City has a low cost of doing business, tens of thousands of new jobs and 15 million new SF of new commercial space.
  • RaleighThe City of Oaks has a young workforce (23% of the population is age 20 to 34), strong universities (UNC, Duke and NC State) and an ever-increasing number of high-tech and pharmaceutical jobs.
  • Salt Lake CityUtah’s capital city experienced some of the strongest job growth last year. Over the last three years, employment increased 15%, three times the national average.

The Continuing Shift

Many investors are shifting their focus away from primary markets and favoring the lower cost of secondary and tertiary markets where they can often pay half of what they would pay for similar assets. With competition crowding many investors out of primary markets, lower purchase costs and rising rents produce higher returns, making these secondary and tertiary markets even more attractive.

As a result, the future of the commercial real estate industry now lies outside of traditional big-city hubs like New York, Chicago, LA, and San Francisco.

Contact the Houston and DFW Real Estate Experts

CXRE’s team of commercial real estate professionals know the Houston and Dallas-Ft. Worth markets. We can help you find new investment properties, sell your assets, lease your assets, and even manage your current portfolio. 

We know the ins-and-outs of each market and often have the inside track on trends and new properties. Contact CXRE today to learn how our team of brokers and property managers can assist you.

Share This

CXRE » Houston » Commercial Real Estate Brokers » What are the Top US Commercial Real Estate Markets?