Commercial real estate development delivered a powerful boost to the U.S. economy in 2025, contributing $1.55 trillion to GDP, supporting 7.37 million jobs, and adding $554.75 billion to personal earnings, according to a new study from the NAIOP Research Foundation. The report underscores a noticeable jump from 2021, when development added $1.25 trillion to GDP, $444.88 billion to personal income, and 6.23 million jobs.
The analysis reflects the "multiplier effect," which measures not only direct spending but the broader economic activity it spurs. The study excludes non-multifamily residential properties, hotels, and government buildings. Direct expenditures on commercial building development climbed to $632.21 billion in 2025, up from $466.70 billion in 2021.
NAIOP estimated that total construction spending, including both building and nonbuilding projects, reached $2.15 trillion in 2025. When accounting for multiplier effects, the sector's overall contribution rose to $5.3 trillion—representing 17.5% of total U.S. GDP—and supported 25.6 million jobs.
Construction costs varied widely by property type between 2024 and 2025. Hard costs rose 15.8% in office projects, decreased 5.6% in industrial, slipped 0.4% in warehouse, and increased 6.6% in both retail/entertainment and multifamily, resulting in an overall increase of 5.8%.
In 2025, construction volumes by building type totaled $22.9 billion in retail, $42.0 billion in warehouse, $50.5 billion in industrial, $85.5 billion in office, and $135.3 billion in multifamily. Those figures compare to 2021 totals of $15.0 billion, $49.8 billion, $32.4 billion, $41.1 billion, and $119.7 billion, respectively.
Measured in millions of square feet, development activity showed modest shifts across sectors. Office construction rose from 123 million square feet in 2024 to 129 million in 2025. Industrial space declined from 108 million to 88 million, while warehouse construction slipped from 399 million to 383 million. Retail/entertainment edged down from 81 million to 79 million square feet, and multifamily development held steady at about 703 million square feet.
Data in the report were compiled from the U.S. Census Bureau, the U.S. Bureau of Labor Statistics, the Bureau of Economic Analysis, the Dodge Construction Network, and the National Council of Real Estate Investment Fiduciaries.
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