By: Matt Mowell and Tyler Deckard

Investors are beginning to look a bit more favorably on the office sector, even long-shunned Class B and C commodity space.

We can see this in CBRE’s biannual Cap Rate Survey (CRS)¹, which provides insight into office property yields. Figure 1 shows Class B and C properties with an estimated cap rate of 10% or more. Each block represents a unique market (geographic market x submarket type x risk profile x class).

After peaking at 74% in H2 2024, the percentage of Class B and C properties with double-digit cap rates declined modestly in the two CRS surveys conducted in 2025. While it’s concerning that more than 70% of Class B and C properties still have double-digit cap rates, increased capital markets activity is enabling office valuations to find a floor, even for marginal assets. This trend is being helped along by office properties that are sold for demolition or conversion.