Office Cap Rates: Downtown vs Suburban Office Buildings
Class A office cap rates range from 5.5% to 14% across US downtowns in CBRE's survey, and 6% to 12.75% in the suburbs. Why office spreads are so wide, and value at each.
By the CapRateCalculator.co team
Office cap rates vary more than any other property type. For stabilized Class A buildings, CBRE’s second-half 2025 survey shows downtown office ranging from 5.5% to 14% across US markets and suburban office from 6% to 12.75%. Single-tenant net lease office, one tenant on a long lease, had a median asking cap rate of 8.00% in the Boulder Group’s third-quarter 2026 report.
Office cap rate figures
| Segment | Cap rate | Source |
|---|---|---|
| Class A downtown (CBD), stabilized | 5.5% to 14.0% across markets | CBRE, H2 2025 |
| Class A suburban, stabilized | 6.0% to 12.75% across markets | CBRE, H2 2025 |
| Single-tenant net lease office | 8.00% median asking | Boulder Group, Q3 2026 |
These are the lowest and highest markets in CBRE’s tables, not averages. Class B and C buildings, which CBRE describes with mixed estimates, trade higher still in most markets.
Value at office cap rates
| Cap rate | Value of $2,500,000 NOI |
|---|---|
| 5.5% | $45,455,000 |
| 8.0% | $31,250,000 |
| 14.0% | $17,857,000 |
The same income is worth two and a half times as much at the bottom of the range as at the top. That gap is the story of office since 2020.
Why office cap rates spread out
Hybrid work reduced how much space many tenants need, but not evenly. Newer buildings with good amenities in strong markets still attract tenants. Older buildings in weaker downtowns face high vacancy, falling rents and large bills for upgrades, and some are worth more as conversion candidates than as offices. CBRE’s first-half 2026 survey called investor expectations for office more polarized than ever.
What moves an office building’s cap rate
Lease term and tenant credit. A building fully leased to a strong tenant for ten years trades closer to net lease pricing.
Vacancy and rollover. Every lease expiring soon brings re-leasing risk, free rent and tenant improvement costs. Those costs are capital spending, not operating expenses, and they belong in the underwriting even though they sit below NOI.
Building class and age. Class A space in a modern building holds value better than older Class B and C space.
Market. The range in the table is mostly a range of cities.
For partly vacant buildings, the stabilized cap rate guide covers valuing a lease-up, and cap rates by property type compares office with everything else.
Sources: CBRE U.S. Cap Rate Survey H2 2025; The Boulder Group, Net Lease Market Report Q3 2026.
Frequently asked questions
What is the cap rate for office buildings right now?
CBRE's second-half 2025 survey puts stabilized Class A downtown office between 5.5% and 14% depending on the market, and suburban Class A between 6% and 12.75%. Single-tenant net lease office had a median asking cap rate of 8.00% in the Boulder Group's third-quarter 2026 report.
Why is the range of office cap rates so wide?
Remote and hybrid work cut demand unevenly. Newer buildings in strong markets still lease up, while older buildings in weaker downtowns face high vacancy and expensive upgrades. Buyers price those two kinds of office very differently, and CBRE describes investor expectations for office as more polarized than ever.
Should I use a cap rate to value a vacant office building?
Be careful. A cap rate on current NOI says little about a building that is half empty. Buyers of vacant or troubled office usually price it on the cost and time to re-lease it, a stabilized NOI and a high cap rate, or on land or conversion value.