Unexpected Strength in Office Transactions Lifts Small-Sized Property Market Article originally posted on Globe St. on August 22, 2025 Commercial property sales in the $5 million to $25 million range are showing resilience in 2025, and one sector in particular is defying expectations. According to Green Street’s latest analysis, overall deal volume in this price bracket rose 3.5% in the first half of the year, climbing from $43.7 billion in 2024 to $45.24 billion. But it was office properties—a category many had left for dead—that turned out to be the standout. Green Street’s data, based on its reporting team, broker networks and transaction participants, shows that the sector’s sales surged 18% year-over-year in the first half, roughly double the 9% increase posted by multifamily. The momentum carried into the second quarter, when office transactions totaled $4.42 billion, a 27% jump from the $3.48 billion recorded in the first quarter. Since Green Street began tracking deals in this size range, only six quarters have registered a higher sales volume. The geographic picture has shifted as well. Los Angeles, once the dominant market for these office-size deals, slipped to seventh place by mid-year. New York led all metros with $398.4 million in sales, followed closely by Boston ($365.6 million), the Washington, D.C. metro ($349.9 million) and San Jose ($344.6 million). Rounding out the top ten were Orange County, Phoenix, Los Angeles, Dallas-Fort Worth, Chicago and San Diego. Measured by the number of properties sold, New York also came out ahead with 35 transactions in the first half, trailed by Boston (33) and Phoenix (32). Philadelphia cracked the list at ninth place, with 26 deals, while Dallas/Fort Worth rounded out the group at 10 with 21. Growth rates told yet another story, spotlighting smaller or emerging markets. Palm Beach, Florida, posted an extraordinary 809.8% jump in office transactions, leaping from $15.7 million in 2024 to $142.6 million this year. San Jose recorded a 175.2% increase, while the D.C. metro rose 114.5%. Boston (87.2%) and Orange County (86.5%) also posted sharp gains. Chicago, Philadelphia, New York and Dallas/Fort Worth all landed in the top ten for percentage growth as well. Still, broader challenges remain in office utilization. Comparing the first half of 2025 to the same period in 2019, office use was down 41%, Green Street reported. New York was 26% below 2019 levels, Dallas 36% and the D.C. metro 40%. Los Angeles trailed by 43%, while San Francisco and Seattle sank further, with the Emerald City down 53% despite some rebound from Amazon’s return-to-office mandate. Green Street’s findings highlight the uneven path of recovery for U.S. offices: investment demand at smaller deal sizes shows signs of confidence, even as physical occupancy lags well behind pre-pandemic levels.