Vacancy rates in commercial real estate are trending lower and showing signs of stability in metropolitan statistical areas across the nation, according to the latest report from Keefe, Bruyette & Woods.

The research firm put together a first-quarter report called, "Location, Location, Location: Commercial Real Estate MSA Tracker."

The metros rated as the top commercial real estate areas based on vacancy rates, overall economies and other real estate data included Austin, Houston, Raleigh-Durham and San Francisco. Meanwhile, Detroit, Cleveland, Chicago, Los Angeles and Philadelphia were ranked at the bottom.

"Not surprisingly, better job growth is a common theme for better-performing markets," KBW said. "When compared to 4Q of 2011, Baltimore and Seattle had the most overall significant improvements in rankings, while Dallas and San Bernardino/Riverside reported the most deterioration in expected future real estate fundamentals."

The firm noted that vacancy rates are set to decline with the economy ready to recover and supply constrained. Real estate investment trusts with portfolios in New York, Boston and San Francisco, San Francisco, North Carolina and Texas will see their near-term core portfolio benefit from declining vacancy rates, the report suggested.