California’s housing shortage continues to present compelling development opportunities in the multifamily market. The Summer 2026 Forecast shows that 75% of Northern California respondents and 64% of Southern California respondents expect multifamily demand to outpace supply over the next three years.

Retail developers are increasingly concentrating investment on centers that serve everyday consumer needs rather than pursuing traditional large-format retail. Development activity is accelerating, with 75% of Northern California and 61% of Southern California respondents planning at least one new retail project in the next 12 months, up from 60% and 45% respectively in the Winter Forecast.

The industrial market is benefiting from one of the most diversified demand profiles in California commercial real estate. While 32% of respondents identified e-commerce as the primary driver of industrial demand, down from 45% in the Winter 2026 Forecast, developers increasingly cited logistics, advanced manufacturing, robotics and AI-related digital infrastructure as contributing to future growth.