A data-driven look at how supply, demand, and development are shifting in Annapolis and beyond.
View the full report:
https://thomas-park.com/annapolis-cre-market-report/
Despite continued economic pressure from high borrowing costs and slowed construction activity, the Greater Annapolis commercial real estate market remained stable in Q2 2025. The latest CRE Market Report from Thomas Park highlights key trends across retail, office, investment, and development-revealing a market that’s adapting rather than retreating.
Tenant demand remained steady across core submarkets, with pockets of rental growth and active leasing. Asking rents in the retail sector rose, supported by tight supply and demand for smaller-format, service-oriented spaces. Office fundamentals remained largely unchanged, though performance varied by location and asset quality.
Key Submarket Insights from Q2:
Downtown Annapolis: Stable Demand, Rising Standards
Downtown continues to perform well, supported by tourism, legislative activity, and local businesses. Demand is strongest for smaller office and retail suites in walkable, well-maintained buildings with good aesthetics and access to parking. While overall vacancy remains low, landlords are investing in interior upgrades to stay competitive with newer mixed-use projects just beyond the core.
Annapolis Mall Area: Central and Shifting
The Annapolis Mall corridor remains a major hub for retail and medical office. Vacancy is limited, with a shift toward healthcare, wellness, and experiential users taking over traditional retail footprints. Asking rents are rising as tenants seek smaller, high-visibility spaces. Medical office demand remains strong, especially for properties with direct-entry suites and ample parking. Development is sparse, but existing assets with upside potential are drawing investor attention.
Other Trends Noted in Q2:
- Investment volume remains subdued, with most activity centered on stabilized assets in strong locations.
- Construction starts are limited; developers are pausing to reassess timelines and costs before launching new projects.
- Mid-Shore submarkets continue to show mixed performance, with Talbot County seeing more sustained demand than neighboring counties.
Thomas Park’s Greater Annapolis CRE Report provides brokers, owners, and investors with a clear-eyed view of where opportunity lives today, and what’s likely to shift in the months ahead.
View the full report: https://thomas-park.com/annapolis-cre-market-report/