The National Association of REALTORS (NAR) has launched the Commercial Real Estate (CRE) Demand Index, a new quarterly tool designed to measure the economic drivers of commercial real estate demand across more than 300 U.S. metropolitan areas.
Unlike traditional indicators that track vacancy rates, rents or leasing activity, the CRE Demand Index focuses on local economic conditions that generate demand for commercial space. By analyzing government data, the index aims to provide an early view of market trends before they appear in standard real estate metrics.
The index tracks performance across four key property sectors: office, which focuses on employment growth within professional and business services; industrial, which monitors job gains in manufacturing, transportation, and warehousing; retail, which tracks employment trends in retail trade, leisure, and hospitality; and multifamily, which measures population increases driven by domestic and international migration.
The index evaluates 306 metropolitan areas, using a score of 100 to represent the average metro. Scores above 100 indicate stronger demand drivers relative to other markets, while scores below 100 indicate weaker relative momentum.
Initial findings from the inaugural index highlight St. George, Utah, as the top overall metro with a score of 128. South Carolina was identified as the strongest state for commercial real estate demand. Among the 50 largest metropolitan areas, Raleigh, North Carolina, ranked highest with a score of 121, surpassing its performance during the 2022 pandemic-era migration peak.
The CRE Demand Index will be updated quarterly, with historical data available back to 2022.
