Market Reports

Cedar Rapids: a City with Momentum

by Kristin Harlow August 3, 2023

By Scott Olson, Skogman Commercial Despite a derecho, a pandemic, inflation, supply chain issues and a possible recession, Cedar Rapids continues its rapid growth as evidenced by the ranking by “American Growth Project 2023” as a top 15 fastest-growing mid-size U.S. city. But, its other national rankings are just as impressive: • 23rd-Best Run City in U.S. (wallethub.com, 2023) • Top 100 Best Places to Live in America (Livability, 2023) • 23rd-Best Place to Raise a Family (wallethub.com, 2023) • 13th-Best City to Buy a House (niche.com, 2023) • Ranked No. 21 of Cities with Lowest Cost of Living (Business Insider, 2023) • A Cleanest U.S. City by Short-Term Particle Pollution (American Lung Association, 2023) • Two Nationally Ranked Medical Centers: St. Luke’s Hospital and Mercy Medical Center (PINC Al/Fortune and Newsweek, 2023) • Top 50 Best City for Jobs in America (wallethub.com, 2023) • No. 22 Safest City in America (wallethub.com, 2022) • Best Tasting Drinking Water in Iowa (Iowa Section, American Water Works 2022) In addition to these rankings, Cedar Rapids is also continuing to make major progress on recovery from previous national disasters: • 2008/2016 historic floods are resulting in the $750 million flood control system making …

August 3, 2023

Industrial Iowa Market Reports Midwest Midwest Market Reports

Tenant Demand Remains Strong for Des Moines Industrial Space

by Kristin Harlow June 22, 2023

By Jeremy Spillman and Corey Sedrel, Capstone Commercial In a setting where I-80 and I-35 intersect to make up one of the busiest truck traffic intersections in the Midwest, Des Moines is well positioned to harness the power of manufacturing in Iowa to support several larger Midwest cities such as Chicago, Minneapolis, Kansas City, St. Louis and Omaha. As we see change in our global supply chains, manufacturers and distributors look to states like Iowa to support these changing environments where we see these organizations moving away from the just-in-time model to just-in-case. The transition to a just-in-case supply chain model began to form due to several supply chain-related issues we encountered during the pandemic. This led to higher demand for additional warehousing to be constructed. Availability of large cube warehousing had been historically tight in Iowa since 2012 where most years carried vacancy rates of 2.5 to 4.5 percent annually. During 2022, there was 2.97 million square feet of warehouse/distribution space delivered to meet the increase in demand of rising inventories. “From the construction standpoint, supply chain issues are subsiding, but there are still longer than normal lead times for certain trades and equipment. These lead times are still …

June 22, 2023

Iowa Market Reports Midwest Midwest Market Reports

Real Estate Momentum Continues in 2022 in Cedar Rapids

by Kristin Harlow August 4, 2022

By Douglas Laird and Karl Hoffman, Skogman Commercial Realty Last year’s article on Cedar Rapids began by describing the 2020 Derecho windstorm that brought major damage to Iowa. This included our entire city of Cedar Rapids — an area of 75 square miles. There has been good progress toward recovery; yet many homes and businesses are still in need of repair. In addition, both individuals and companies confront inflation, energy costs and unpredictable consumer costs and shortages. In spite of these hurdles, however, the growth in the multifamily, residential and industrial sectors matches national trends. National rankings are exemplary for the city of Cedar Rapids: • No. 10 in “Best Cities to Buy a House in America” • No. 18 in “Cities with the Lowest Cost of Living in America” • No. 3 in the list of “Top 20 Fastest Metro Areas to Save for Your First Home” The multifamily sector has many exciting new projects in the pipeline totaling over $100 million. Here are just a few: • First on First West: a mixed-use site along First Avenue West • Loftus Lumber site: a five-story building with 186 market-rate units • KCG Development at Jacolyn Drive SW Land sales …

August 4, 2022

Iowa Market Reports Midwest Midwest Market Reports Office

Collaboration, Creativity and Coffee: Reasons Why the Office Still Matters

by Kristin Harlow June 30, 2022

By Chris Curran and Alexa Strickler, R&R Realty Group It’s no secret that the past couple of years have been dramatically different for us all. We’ve had to adjust to new routines, new practices and new ways of getting work done. Some of these new things will be here to stay while others have already receded into memory. No matter the amount of change though, one thing remains the same. That’s the need for human connections and relationships. And, ultimately, that’s what physical office space provides. It seems many organizations are starting to understand just how valuable this connection truly is. Across various submarkets within the Des Moines metro area, companies large and small are returning to in-person work. And it’s not just existing customers returning to their spaces. There has been a marked uptick in office leasing activity in locations ranging from downtown to the western suburbs. From advertising agencies to accounting firms and more, the vacancy rate across the entirety of central Iowa is beginning to be chipped away. Why are so many companies across a wide variety of industries heading back to the office? Well, like we mentioned earlier, there’s a sense of connection and an ability …

June 30, 2022

Affordable Housing Iowa Market Reports Midwest Midwest Market Reports Multifamily

Organizations Align to Address Housing Affordability in Des Moines

by Kristin Harlow June 23, 2022

By Ryan Kelly, TWG Development Despite the affordable housing crisis, Des Moines has managed to endure the adverse factors that have caused a boom in housing prices nationwide — but we still have a ways to go. A sustained demand, an influx of business and new projects by national developers all played a role in Des Moines’ multifamily growth over the past two years. Developing Des Moines Home to some of the largest multinational finance and insurance corporations, Des Moines has pioneered Iowa’s growth. The city has also seen population growth — the most recent census revealed that Des Moines’ suburbs led to Iowa’s development while the city itself grew by 5.4 percent. Des Moines is the 10th-best place for business and careers, according to Forbes, and ranked as the fifth-best city to live in, according to U.S. News and World Report. The capital city has experienced a boom in employment, with a rise in the number of high-tech jobs, at a 6.7 percent rate. The Midwest’s low cost of living (7 percent lower than the national average) and Des Moines’ proximity to large cities have contributed to the growth of key industries, including logistics, ag-bioscience, manufacturing, data and insurance. …

June 23, 2022

Industrial Iowa Market Reports Midwest Midwest Market Reports Multifamily Single-Family Rental

Resilience, Growth in Cedar Rapids is Unparalleled

by Kristin Harlow September 9, 2021

By Scott Olson, Skogman Commercial On Aug. 10, 2020, eastern Iowa was hit with a derecho. This is the Spanish word for a widespread, long-lived, straight-line windstorm that is associated with a fast-moving group of several thunderstorms. Winds in southwest Cedar Rapids were estimated to be 140 miles per hour with the entire city of 75 square miles sustaining major damage. The statistics are staggering: • Cedar Rapids lost 669,000 mature trees, about 70 percent of its urban canopy. The storm left at least 4.5 million cubic yards of debris. Stacked 35 feet tall and wide, it would extend a whopping 24 miles. • 6,000 homes and properties were damaged. As repairs and reconstruction got underway, the city issued 25,000 building permits in fiscal-year 2021, more than double the number in a typical year. • City government buildings suffered $20 million in damage, while the business community reported losses totaling $170 million. About $70 million of that was the result of derecho-related shutdowns or power outages. • The state cumulatively sustained $11.5 billion in damage, according to the National Oceanic and Atmospheric Administration, which calls the Aug. 10 derecho “the costliest thunderstorm in U.S. history.” However, as evidenced in the …

September 9, 2021

Iowa Market Reports Midwest Midwest Market Reports Office

Des Moines Office Market Is on the Rebound

by Kristin Harlow July 29, 2021

By Chris Curran and Mark Mills, R&R Realty Advisors Would you rather earn more money or have a more flexible work/life balance? Before the pandemic, many employees gave the latter as their answer. But the amount of money employees claimed they would forego wasn’t exactly peanuts. According to a pre-pandemic study by career site Joblist, the average employee was willing to give up around $10,000 per year to have better work/life balance. Fast forward to the present day and employees continue to express this desire. The isolation felt by many when working from home has increased the blurriness of the line that separates work from life. In fact, a survey conducted by TELUS International found that isolated workers reported a nearly 80 percent increase in work-related stress and anxiety when working from home. Given these findings, perhaps it shouldn’t surprise anyone that three out of four office employees express a desire to return to in-person work. If there’s a silver lining to the unprecedented year we’ve been emerging from, it may be that employees and employers alike are coming to understand the value in providing a balance between work and personal time. And, when it comes to the office market …

July 29, 2021

Iowa Market Reports Midwest Midwest Market Reports Retail

Greater Des Moines Retail Market Is on Track for Fast Recovery

by Kristin Harlow July 22, 2021

By Christopher Stafford, Cushman & Wakefield The Greater Des Moines retail market continues to emerge from the pandemic and is quickly regaining its footing from the closures and challenges experienced by many retailers, restaurants and businesses alike. Despite a few setbacks, occupancy rates and rents have generally held steady. Consumer spending is surging and according to a WalletHub study, Iowa’s COVID-19 recovery is the quickest in the nation, earning a total score of 75.25 out of a possible 100. The study compared all 50 states across three categories: COVID health; leisure and travel; and economy and labor market. Trends, observations A local real estate mogul recently made the analogy that the Des Moines retail market is currently much like a chessboard — lots of moving pieces and strategic repositioning by the current players. Greater Des Moines, like other Midwest cities, is experiencing a handful of post-pandemic retail trends that include: • Integrated retail approach (omnichannel): Bricks & mortar + online presence and ordering + apps + delivery/pickup. The presence of drive-thru and pickup services will shape the future of retail and are in high demand by restaurants and retailers. • Space transformation: Spaces once occupied by traditional retailers are now …

July 22, 2021

Iowa Market Reports Midwest Midwest Market Reports Retail

Investors Shift Focus from Higher Returns to Stability, Proven Cash Flow

by Kristin Harlow February 4, 2021

By Tyler Dingel and Blake Bogenrief, CBRE | Hubbell Commercial COVID-19, and the immediate uncertainty that came with it, slowed investment activity in nearly all markets. The transactions that have closed since March, and those that will follow in the coming months, are changing. Investors and lenders alike are more thorough in upfront analysis, more selective in tenants, and overall, trending more conservative. The vision is now long-term oriented, and the spotlight is shining brightly on essential goods and services as well as investments with proven track records. Slow and steady is winning the race. Investor concerns Over the last 12 months, a common concern for real estate investors has been what the future holds for capital gains taxes. Many sellers are contemplating and opting to “take the hit” now as opposed to down the road when capital gains tax could be replaced by the ordinary income tax rate. In addition, the Biden Administration seeks to increase individual tax rates while the U.S. continues to deliver financial aid to the masses. Nearly nine months following the CARES Act, Congress agreed on a second, $908 billion stimulus package. Many expect that taxes will do one of two things in the future …

February 4, 2021

Iowa Market Reports Midwest Midwest Market Reports

Cedar Rapids Shows Resilience, Growth in Times of Crisis

by Kristin Harlow September 17, 2020

By Scott Olson, Skogman Commercial Since starting a series of annual articles on Cedar Rapids in 2013 after the recovery from the historic floods of 2008 and 2016, I never anticipated the city would be facing an event in 2020 that would reach beyond those levels of flood impact. Now, the COVID-19 pandemic has given our city new challenges for this year and beyond. Hopefully this is a once-in-a-lifetime health event that, unlike the floods, has impacted nearly every city in the country in many ways. But there is a reason Cedar Rapids was named “All America City” in 2014. Here is why I make that statement. In February 2020, SmartAsset.com named Cedar Rapids the No. 2 “Most Recession-Resistant City in America.” Then as the pandemic spread, Business Insider named Cedar Rapids the No. 11 “Top American City to Live in After a Pandemic.” With the historic low interest rates created by the pandemic and a decade-low inventory of listed residential properties, Cedar Rapids was ranked by lendedu.com as the No. 34 city with the most affordable homes in the U.S. That report showed that 96 percent of our homes are affordable for the average household living in the city. …

September 17, 2020

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