In the United States, the market edged down to $4.9 trillion from $5 trillion in 2023. Despite this decline, the U.S. share of the global real-estate market grew to 39.1%, as markets elsewhere fell more sharply, according to MSCI. The U.S. market’s roughly 1% annual contraction reflected continued investor hesitancy in the face of elevated interest rates.
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Within global real estate, the office sector remained the largest professionally managed asset class in 2024, accounting for about 27.3% of the market, though this was down from 28.9% a year earlier. The residential sector was the second largest globally at 22.7%, followed by industrial properties at 18.9% and retail at 18.3%. Hotels and healthcare assets together comprised another 8.2%, with hotels contributing 5.4% and healthcare 2.8%.
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In the Americas, residential property led the market, driven by the substantial supply of professionally managed apartments in the United States. MSCI reported that residential real estate made up 29% of the U.S. market in 2024.
The office sector stood out for its geographic diversity. The smallest single-country concentration among the four largest sectors was in offices, with the U.S. accounting for 28.1% of the global total. By contrast, residential properties were more heavily concentrated in the U.S., which represented 53.1% of global residential assets.
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Globally, office assets under management were relatively dispersed, with the five largest office markets making up 58.3% of total office holdings. In comparison, both industrial and residential sectors saw more than 70% of their assets under management concentrated in the top five markets, while retail properties had a concentration of 60.1%. Hotel and healthcare assets were heavily weighted toward the U.S., which accounted for 47.1% of hotel holdings and 55.3% of healthcare assets, according to MSCI’s analysis.
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Amid this downturn, deal activity showed signs of recovery. Transaction volume climbed 18% in 2024, rebounding from a 48% drop the year prior. MSCI attributed this turnaround to greater stability in interest rates during the second half of the year, which helped restore investor confidence and fuel dealmaking.