2026 Charlotte Commercial Real Estate Outlook

Charlotte Entered 2026 from a Position of Strength- Charlotte continues to outperform many U.S. metros in job growth, population expansion, and long-term economic fundamentals. While 2025 was not a rebound year in the traditional sense, it marked stabilization across most property types following the 2023–2024 capital markets reset.

Leasing activity improved in multiple sectors, new construction slowed meaningfully, and investment sales volume began to recover. The market is transitioning into a more disciplined and selective phase. For owners, this is no longer arising-tide environment. Asset quality, submarket positioning, tenant stability, and capital structure now drive performance more than broad market momentum.

Capital Markets: Liquidity Has Improved — Selectivity Remains- After two years of suppressed transaction activity, Charlotte saw investment sales volume increase materially in 2025. Buyers and sellers are aligning more closely on pricing, and capital has cautiously re-entered the market. However, capital is flowing first to:

Stabilized assets
Strong demographic submarkets
High-credit tenancy
Lower-risk property profiles

Transitional assets and properties with elevated vacancy continue to face pricing pressure.

Medical office assets, in particular, have maintained stronger investor interest relative to traditional office. Over the past 12 months, Charlotte medical office transactions averaged approximately $215 per square foot, with cap rates around the mid-7% range — reflecting continued demand for stabilized healthcare-oriented properties.

Owner takeaway: Liquidity has improved, but underwriting remains disciplined. Predictable income streams are commanding attention, while repositioning plays require realistic pricing and longer hold horizons.

Office: Clear Bifurcation — and Medical Office Outperformance- Charlotte’s traditional office market showed signs of stabilization in 2025, with multiple quarters of positive absorption and limited new construction underway. That said, performance remains highly segmented. Newer, renovated, and well-located buildings continue to capture leasing activity. Older, unrenovated inventory remains under pressure.

Medical office continues to tell a different story. Charlotte’s medical office market is operating at approximately 95% occupancy, with availability near 5% — significantly tighter than conventional office. Net absorption over the past year has remained positive, even as new construction has slowed sharply. Over the past five years, more than 1.4 million square feet of medical office space was delivered across the region. Today, only a fraction of that volume remains under construction, signaling a meaningful slowdown in new supply. Submarket dynamics are important:

Single-story, walk-up medical office properties remain especially tight.
Multi-story assets are slightly looser but still operating at healthy occupancy levels.
Hospital-adjacent and high-income suburban corridors continue to command premium rents.

Medical office rents have increased approximately 15% over the past five years and more than40% over the past decade. While annual growth has moderated, long-term fundamentals remain intact. This divergence between medical office and traditional office is structural, not cyclical. Demand is driven by healthcare utilization, demographic trends, and hospital system expansion — not remote work patterns.

Owner takeaway: “Flight to quality” applies broadly, but medical office remains one of the most stable segments within the office category. Owners with hospital-aligned, well-located assets are positioned differently than conventional office landlords.

Industrial: Fewer Deals, Larger Tenants - Industrial leasing slowed in 2025, particularly among smaller users navigating economic uncertainty. Larger tenants continued to transact, resulting in fewer but larger lease deals. Sublease availability increased modestly, tempering rent growth in certain submarkets. However, new supply is tapering, and fundamentals are expected to rebalance in2026. Charlotte’s long-term industrial advantages — regional distribution access, infrastructure connectivity, and population growth — remain strong.

Owner takeaway: Modern, well-located industrial product continues to attract demand. Owners of older or mid-bay assets may experience more leasing friction, but long-term fundamentals remain durable.

Retail: Tight Supply Continues to Support Performance- Retail remains one of Charlotte’s strongest-performing asset classes. Population growth and household formation are supporting neighborhood and grocery-anchored centers. Limited new construction has pushed rents higher, particularly in suburban submarkets with strong demographics. Higher-income household growth continues to support both necessity-based and select discretionary retail.

Owner takeaway: Well-located retail centers with strong tenant rosters remain well-positioned. Limited new supply continues to underpin performance.

Multifamily: Stabilization Before Growth- Charlotte experienced a historic wave of multifamily deliveries between 2023 and 2025.Vacancy increased in heavily developed submarkets, and rent growth moderated. As new construction slows, the market is entering a stabilization phase. Suburban submarkets with limited new supply have outperformed urban cores.

Owner takeaway: Multifamily owners should expect normalization before renewed growth. Timing and submarket selection remain critical.

What 2026 Means for Owners- 2026 is shaping up to be a normalization year — not a boom cycle. Capital markets are functioning again, but underwriting remains conservative. Asset quality, tenant strength, lease structure, and submarket positioning are driving outcomes more than broad market appreciation. Charlotte remains one of the Southeast’s most resilient growth markets, supported by demographic expansion, healthcare system growth, infrastructure investment, and economic diversification.

For medical office owners in particular, structural demand drivers remain intact. Stabilized, hospital-aligned assets continue to attract capital, especially in the sub-$10 million range where private buyers and 1031 exchange capital remain active. The market is no longer forgiving — but it remains opportunity-rich for disciplined owners who understand positioning, capital strategy, and long-term fundamentals.