Office Sales Jump 31% in July as Retail Earnings Split Between Winners and Losers

Office Sales Are Back, Sort Of

U.S. office building sales hit $7.6 billion in July 2026, up 31% from July 2025, according to a September report from Colliers relayed by Bisnow, CRE Daily, Yahoo Finance, and allwork.space. All four outlets are drawing on the same Colliers dataset, so treat this as one source, not four confirmations.

Office was one of only two traditional commercial property sectors to post sales growth that month. It was also the only traditional sector with rising prices, up a modest 4% year-over-year, according to Colliers.

That stood out against a flat backdrop. Total commercial real estate sales across major sectors came to $36.3 billion in July, down 1% from a year earlier, per Colliers.

Two deals show the pickup in real terms. Houston's Williams Tower sold for $300 million, the city's largest office transaction since 2019. Hines paid $151 million for an Austin office tower previously owned by Brandywine, according to CRE Daily and Bisnow.

City centers led the rebound. Central business district office sales jumped 46% in July, versus 26% growth in the suburbs, Colliers found. CBD growth came mostly from single-building sales, which more than doubled, while suburban growth leaned on portfolio deals, including medical office packages.

First-half 2026 office sales reached $40 billion, up 14.1% from the same period last year, according to an Avison Young report cited by Bisnow. New York, the Bay Area, and Houston led that activity. Vacancy rates fell in more than half of major U.S. markets, with AI-related leasing demand cited as a driver in New York and San Francisco, though the occupancy gains weren't limited to tech hubs.

The Rebound Has Limits

Rising sales volume isn't the same as rising value everywhere. Hospitality sales jumped even harder than office, up 61% year-over-year to $2.5 billion in July, led by full-service hotels, according to Scotsman Guide's Jeff Bond, who reviewed the same Colliers report in more detail. But the hotel price index fell 8.6% year-over-year even as volume surged, and trailing 12-month cap rates rose to 8.3%. That combination of rising sales alongside falling prices points to buyers picking up distressed assets at a discount, not a sector on fire.

Multifamily, the largest sector by dollar volume, told a similar story. July apartment sales fell 16% year-over-year to $12.4 billion, and the apartment price index dropped 4.1%. One large California portfolio deal propped up the numbers; without it, portfolio activity would have declined too, per Scotsman Guide. Retail property sales (the commercial real estate kind, not store chains) fell 13% to $4.7 billion, with its own price index down 0.9%.

So office's 4% price gain, while real, is happening in a market where three other major sectors are still seeing prices fall. That's a rebound with an asterisk, not a full recovery.

Retailers Split on Who's Actually Shopping

While CRE investors were picking through office deals, the country's biggest retailers were reporting second-quarter earnings the week of August 17, and the results didn't move in the same direction, according to Panos Mourdoukoutas of The Epoch Times.

Target's sales climbed, margins improved, and the company raised its full-year outlook, sending shares up 7% for the week. CEO Michael Fiddelke told analysts on the August 19 earnings call the company is executing on merchandising, in-store experience, technology, and workforce investment "delivering change that is resonating with guests."

John Zolidis of Quo Vadis Capital, a longtime Target watcher, told The Epoch Times much of that strength came from easy comparisons to a weak year-ago quarter and shoppers boosted by unusually generous tax refunds. He argued Target sits in a sturdier position between Walmart and Amazon than markets give it credit for, saying customers "will buy when the service levels are appropriate, the product is compelling, and the prices are attractive."

Ross Stores posted total sales up 13% and comparable-store sales up 10% for the quarter, reported August 20, and raised its guidance, sending shares up 4.4% the next day. CEO Jim Conroy credited "compelling merchandise offerings" and in-store improvements for momentum he said held "throughout the quarter."

TJX's Marmaxx division, by contrast, saw purchases come in lower than expected, and Walmart posted a strong headline quarter that still fell short of Wall Street's expectations, according to The Epoch Times.

That divergence lines up with broader consumer data referenced in the same reporting. Retail sales unexpectedly fell in July, and the University of Michigan's consumer sentiment index sank in August after a two-month rebound. Americans are still spending, per Mourdoukoutas's reporting, but they're increasingly picking value chains like Target and Ross over mid-tier options. The same pattern is showing up in commercial real estate, where CBD office towers and full-service hotels are trading while apartment and shopping-center prices keep sliding.

The open question is whether that selectivity holds through the rest of 2026, or whether a softening consumer, reflected in July's retail sales dip and August's sentiment drop, eventually catches up with the landlords and retailers currently outperforming. Colliers' next monthly report and Walmart's and Target's holiday-quarter results will be the next data points worth watching.