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.
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%.
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.
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.
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.
