Market Reports

Grocery Chains and Other Retail Categories are Making Hay in Mid-Atlantic Region

by John Nelson January 11, 2022

The Washington, D.C., and Baltimore markets, when combined, represent the fourth-largest metropolitan region in the nation by population, and retailers are taking notice again. Grocery-anchored projects are the most prevalent in the headlines. For example, the first of nearly 20 Amazon Fresh locations has opened in the area. Additionally, Wegmans’ smaller format rollout plan is active with its first location in Stonebridge’s Carlyle Crossing in Alexandria opening spring 2022, along with Roadside Development’s City Ridge Project at the former Fanny Mae Headquarters in Northwest D.C. Former Shoppers Food Warehouse boxes also continue to get absorbed by new grocers. A less-covered sector of the grocery market is the international markets category, which remains very active in the region. There are 29 different banners across the region that exceed 10,000 square feet in size, with the newest entrant being Oh! Markets in Northern Virginia. Other international market newcomers, including 99Ranch and Enson Market, are also searching for space. With the immense ethnic diversity of the region, we expect investors to start taking notice of this sector with their acquisition appetite, just as they have in other regions like Texas and Florida. Publix, a customer favorite, is in the early stages of identifying …

January 11, 2022

Market Reports Maryland Office Southeast Southeast Market Reports

Maryland Governor Hogan’s Good News for Baltimore’s CBD, Demand Rises for Mental Health Space

by John Nelson June 21, 2021

Among Maryland’s hardest hit submarkets the past 12 months is the Baltimore Central Business District (CBD), where the vacancy rate has risen to 16 percent, according to CoStar Group. Notable departures from companies such as T. Rowe Price and Legg Mason have accelerated during the pandemic due to aging infrastructure and rising crime, coupled with the expansion of sexy nearby submarkets, Inner Harbor East and Harbor Point. Combined these factors have stressed property owners and businesses trying to survive. Downtown restaurants in particular have suffered even more from the double whammy of the area’s rising pre-pandemic vacancies followed by the crushing hit from the spread of COVID-19 and government shutdowns. State government swoops in But Baltimoreans just received some good news from Maryland Gov. Larry Hogan that is sure to spur economic and social revitalization of its CBD. Over time the State of Maryland will be relocating 12 agencies and approximately 3,300 employees to available properties throughout the CBD from an aging Midtown office complex known as State Center. The first agency on the move will be the Department of Human Services (DHS), which has an RFP out for approximately 105,000 square feet of office space. The Department of Health …

June 21, 2021

Market Reports Maryland Multifamily Single-Family Rental Southeast Southeast Market Reports

Baltimore’s Stable Apartment Market Attracts New, Returning Buyers

by John Nelson June 14, 2021

Consistent with much of the nation, the Mid-Atlantic region locked down at the onset of the COVID-19 pandemic in March 2020. However, by late August 2020 and throughout the first quarter of 2021, activity in the multifamily asset class picked up considerably. As operations stabilized and investors could better determine valuations, regional transaction volume quickly heated up as investors returned with pent-up demand. Aided in part by the continued government stimulus and rent regulation in the Mid-Atlantic, Baltimore’s durable “meds and eds” employment bases, anchored by the life sciences, medical, higher education and technology sectors, bolstered the region’s stability. The Baltimore multifamily market has performed in-line with comparable metropolitan areas in the Mid-Atlantic, with flat to moderate rent growth. Rents are expected to stagnate or struggle in response to heightened development occurring in Downtown Baltimore, Owings Mills and Towson, and the new supply may surpass demand in the near-term. Despite muted rent growth projections, transaction volume has returned with an expanded pool of multifamily investors, driving cap rates down and valuations up. Shifting east “Charm City” boasts blue-chip Downtown employers such as T. Rowe Price, Pandora, University of Maryland Medical Center, Johns Hopkins Hospital and Under Armour. In theory, this …

June 14, 2021

Industrial Market Reports Maryland Southeast Southeast Market Reports

Baltimore’s Industrial Market is Stronger Than Ever, And There’s More to Come

by John Nelson June 7, 2021

Baltimore’s industrial market has been flourishing for years, but current trends suggest it may be poised to become one of the hottest markets in the United States over the next few years. Supporting these dynamics will be continued growth in e-commerce, a new emphasis by manufacturers and retailers on expanding their “safety stock” in warehouses and increasing land constraints in the Mid-Atlantic. The confluence of these trends is expected to drive average Baltimore industrial rents at one of the fastest clips of any market in the United States over the next two years. In 2021, the Baltimore industrial market recorded its most active first quarter of gross leasing in over a decade. Net absorption of 1.3 million square feet sparked the year with a strong start as the region’s industrial vacancy rate continued to hover near its lowest level in more than a decade. Vacancy in Baltimore industrial properties has been stable since 2018, despite approximately 12 million square feet of new warehouses constructed in that time span. Several important trends are driving the record-breaking market conditions and are expected to facilitate growth into the foreseeable future. The first trend is a sharply recovering economy in 2021 that may perform …

June 7, 2021

Market Reports Maryland Retail Southeast Southeast Market Reports

Baltimore Retail Market Stands Tall, Poised for Another Solid Year Ahead

by Alex Tostado March 23, 2020

It’s gearing up to be another solid year for Baltimore’s retail industry. Thus far, the first quarter has shown few surprises and has largely been a continuation of the success the sector saw in fourth-quarter 2019. Rent has remained relatively flat the past two years, outside of a few developments that have delivered, and we’re expecting more of the same this year. After a small bump in the road five years ago, the market has stabilized and retail vacancy in the Baltimore metro region remains tight. With limited new supply coming to market, landlords are focused on backfilling existing space. Class A and B properties continue to show healthy leasing trends, while Class C properties continue to be the value options for mostly local retailers. Baltimore metro’s primary retail corridors — York Road, Reisterstown Road, the core of downtown Baltimore, Columbia, White Marsh and Annapolis — continue to thrive. We’re also seeing strong growth along Ritchie Highway from Pasadena to Glen Burnie, buoyed by a string of new store openings at the Pasadena Crossroads Shopping Center, which is anchored by Sprouts Farmers Market, Ulta Beauty, T.J. Maxx, DSW, LA Fitness, Party City, Hobby Lobby, HomeGoods and Gardiner Wolf Furniture. In …

March 23, 2020

Baltimore Multifamily Rent and Occupancy Forecast March 2020

Content Partner Lument Market Reports Maryland Multifamily RED Capital Group Southeast Southeast Market Reports

Underappreciated Multifamily Markets: Maryland Edition

by Jaime Lackey March 17, 2020

Although attractive multifamily investment opportunities may still be available in gateway cities, investors increasingly are sourcing deals in secondary markets where land and asset prices are lower, cap rates a bit more generous and an unpicked gem of value-add fruit can still be found on the vine by intrepid late-cycle buyers. Parties looking to replicate past successes may not have to look too far afield as Maryland markets — overshadowed of late by Washington and Philadelphia — offer much of what they seek with perhaps a lower degree of risk. In the last decade and particularly the last three years, the catalyst for economic growth in the Capital Area has shifted from government to high-tech services. As the tide turned, the focus of commercial real estate activity moved south toward Washington’s central core and Northern Virginia. In the process, the Maryland suburbs lost some of their star power. The diminished status of Montgomery and Prince George’s counties wasn’t entirely a matter of perception. Suburban Maryland apartment performance materially underperformed national averages in 2017 and 2018, and the spread widened between cap rates applied to Maryland properties on one hand and District and Northern Virginia assets on the other. Same-store property …

March 17, 2020

Industrial Market Reports Maryland Southeast Southeast Market Reports

After Historic Industrial Leasing Year in Baltimore Region, What Comes Next?

by Alex Tostado March 16, 2020

Industrial leasing activity in the greater Baltimore metropolitan region last year began with a whimper thanks to the federal government shutdown in January and February, but quickly gathered steam and never looked back, even in the final days to close out the year. In fact, the pace was record-breaking and historic by any measurement, with more than 9.5 million square feet of space absorbed. This figure was approximately 40 percent higher than 2018, which was also a tremendous year. There is more good news locally for companies that make their living developing warehouse and industrial space, brokers who match end-users for the available spaces and related professionals. Central to this activity is that fact that lots of people live in the Combined Statistic Area of Baltimore-Washington, D.C. region, which is the fourth largest MSA in the country and is still growing. A certain Seattle-based online retail company is establishing its second headquarters just down the road in Northern Virginia and its positive impact is being felt throughout the region. The central Maryland marketplace boasts an enviable transportation network led by major north-south axis Interstate 95, is within close proximity to several major seaports (Baltimore, Wilmington and Philadelphia) and one-third of …

March 16, 2020

Market Reports Maryland Office Southeast Southeast Market Reports

The Burgeoning Columbia Market Steps Out of the Shadows of Baltimore, D.C.

by Alex Tostado March 9, 2020

As real estate becomes more operational, a trend has emerged of major investors migrating away from big metros into secondary and tertiary markets. Occasionally, those markets move out of the shadows of their larger neighbors and acquire their own identity. Enter Columbia, Maryland, which initially attained national attention and acclaim as one of the first master-planned communities in the United States. Columbia is now in the midst of a major transformation. Built from the ground up in then-bucolic Howard County, Columbia was founded by developer James Rouse in 1967. Strategically located between Baltimore and Washington, D.C., the now 53-year-old community is blossoming with its own talent creators, talent attractors and 14 million square feet of new live-work-play development in a downtown transformed by The Howard Hughes Corp., a successor to The Rouse Co. The beginnings of Downtown Columbia’s emergence include the Merriweather District, which opens this spring. The first of three neighborhoods planned for downtown Columbia, the Merriweather District is being developed as a regional hub of culture and commerce. Talent creators The Howard County market is already home to cybersecurity incubators and cyber-focused venture capitalists like DataTribe and AllegisCyber. These companies consistently house and fund entrepreneurs developing innovative approaches …

March 9, 2020

Industrial Market Reports Maryland Southeast Southeast Market Reports

Land Scarcity in Baltimore Driving More ‘Smart Growth’ for Industrial Sector

by Alex Tostado September 16, 2019

Continuing a trend that started approximately 10 years ago, the Central Maryland region remains an extremely attractive area for warehouse and industrial development with vacancy rates hovering in the 7 percent range, more than 3 million square feet currently underway and an additional 5 million square feet of space expected to break ground over the next 18 months. But new challenges are also starting to emerge in this marketplace, driven by barriers-to-entry such as land scarcity and increased government regulations. On the positive side, rental rates continue to inch upwards and end-user requirements in the 30,000- to 100,000-square-foot range, long the bread and butter of this region, have returned. Over the past decade, numerous local and national developers have been enjoying the high life in the Interstate 95 corridor spanning from Harford County north of Baltimore City, through Howard County and touching Prince George’s County, which is considered a suburb of Washington, D.C. A who’s who of retail royalty have signed substantial leases such as Amazon, Best Buy, FedEx, Floor & Décor, The Container Store, The Home Depot, Pier 1 Imports, Sephora Cosmetics, XPO Logistics and Under Armour. While many touched 1 million square feet of space, what previously was …

September 16, 2019

Market Reports Maryland Multifamily Southeast Southeast Market Reports

After Urban Construction Boom, Baltimore Multifamily is Moving to the ’Burbs

by Alex Tostado September 9, 2019

The multifamily real estate landscape is booming across the Baltimore metro with exciting new development popping up throughout this burgeoning market. Luxury apartment developers have focused their attention on Baltimore City’s urban waterfront neighborhoods by creating a distinct live-work-play environment. At the same time, suburban developers have focused their efforts along the Interstate 95 corridor, drawn to affluent neighborhoods supported by top ranked school districts. While an increase in development has led to a rise in urban vacancy rates, the influx of tech startups, coupled with the city’s employment drivers — medical and educational institutions — has helped to stabilize these rates. TIF investment has also helped paint a bright future in Baltimore for mixed-use ventures like the East Baltimore Development project around Perkins Homes and the 250-acre Port Covington development in south Baltimore. Both projects are anticipated to support new multifamily housing in these areas. Development boom Vacancy rates have increased following a nearly 20,000-unit spike in new construction from 2014 to 2018. More than 3,900 new units were completed in 2018 alone, and another 6,400 units were underway at the start of 2019. The boom is expected to taper off in 2020 and has already caused a decrease …

September 9, 2019

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