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Baltimore Commercial Property Declines and Implications for New Development Projects

Assessed value reductions and office vacancies across downtown areas are shaping conditions for future multifamily and retail activity.

By Baltimore Property Desk · Published July 24, 2026

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This article was written by AI from the linked sources and was not reviewed by a journalist before publishing. The Daily Baltimore is part of The Daily Network and follows our reasonable editorial care.

Baltimore Commercial Property Declines and Implications for New Development Projects — AI illustration

Baltimore has lost over $1 billion in commercial property value since 2020, with Downtown, Inner Harbor, and Downtown West accounting for $1.07 billion of those losses as residential values rise and shift the tax burden to homeowners. Approximately 29% of Baltimore's commercial properties saw assessed value reductions between fiscal years 2020 and 2026.

Property Value Reductions

Approximately 29% of Baltimore's commercial properties (4,085 out of 14,027) saw assessed value reductions between fiscal years 2020 and 2026, averaging a 28.7% decrease. These reductions have concentrated in central business districts where office properties form a large share of the inventory. The shift places added pressure on residential taxpayers as commercial assessments decline.

Office Market Pressures

In Q2 2026, Baltimore's office market faces negative net absorption due to major tenants like OneMain Financial and T. Rowe Price relocating. Two downtown office towers recently hit the market for distressed sales: One North tower has a minimum auction bid of $4M, and the 25-story tower at 120 E. Baltimore St. is listed at a lender's request with an estimated tax value of ~$27M. Industrial vacancies rose to 8.5% after Rite Aid's 900,000 SF exit.

Multifamily and Retail Activity

Despite office headwinds, the market saw robust activity in multifamily and retail, fueling a $1 billion jump in commercial real estate sales in 2024, while industrial rents remain near record highs at $8.06/SF. This activity provides the main channel for new development projects in the current environment. Local investors are directing attention toward sites where multifamily and retail conversions can offset broader commercial losses.

Market participants will continue to monitor absorption figures and distressed asset resolutions to determine where new projects can proceed without adding to existing vacancy pressures. Sales data from 2024 offers the clearest recent indicator of where capital is flowing.

This article is general information only and is not personal financial or investment advice. Consider your own circumstances and seek licensed professional advice before making financial decisions.

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