Market Reports

Where Do We Go Next? New Frontiers Emerge in Phoenix’s Tight Industrial Market

by Jeff Shaw September 2, 2022

By Bill Honsaker, Managing Director, JLL Metro Phoenix recorded more than 7 million square feet of industrial absorption during the second quarter of 2022, setting a quarterly record for the market. The average size of local industrial deals has also ballooned, increasing 25 percent year over year to a new high of 91,095 square feet. The Southwest submarket remains the Valley’s industrial powerhouse, accounting for 68 percent of total leasing volume this past quarter. But as demand for big space continues to swell, so does the pressure on inventory. That leaves the market divided into two groups: those already in the market with land or buildings in their possession, and those who missed the land rush and must now buy out someone else’s position. In fact, across the Valley’s industrial core (roughly bounded by the Loop 303 to the west, Phoenix Gateway Airport to the east, Deer Valley to the north and the lower 202 to the south), would-be investors, developers and tenants are beginning to ask, “Where do we go next?” This dynamic has become a boon for further-out markets to Phoenix’s east and west, as well as to the south — particularly Central Arizona. With projects like Inland Port Arizona, Pinal …

September 2, 2022

Kansas Market Reports Midwest Midwest Market Reports Missouri Multifamily

No End Is in Sight for Kansas City’s Multifamily Development Needs

by Kristin Harlow September 1, 2022

By Chris Armer, Hoefer Welker People who call the Kansas City metropolitan area home know it’s a desirable place to live. From the robust job market and vibrant arts scene to its rich history and, of course, stellar sports teams, the Kansas City metro area attracts a diverse group of people. Kansas City is evolving and so are its housing needs. In recent years, the demand for multifamily development in Kansas City has grown, driven by a range of factors. Mass retirements and flexible work arrangements are shifting priorities, while the housing shortage and rising interest rates are sending prospective homeowners on the search for attractive alternatives. The multifamily housing trend stands to gain momentum, creating a space for discerning real estate and architecture firms with development expertise to pave the way in an evolving housing market. The great shuffle Much has been said about the Great Resignation, but the COVID-19 pandemic didn’t only affect young and midlife workers who left their jobs to pursue higher-paying and more meaningful employment. It also hastened the Great Retirement, a massive wave of baby boomers leaving the workforce, many of them earlier than planned. Now those homeowners are selling their suburban single-family …

September 1, 2022

Market Reports Texas Texas Market Reports

Collin County Economy Evolves, Diversifies as New Commercial Users Emerge

by Taylor Williams August 31, 2022

By Jim Breitenfeld, CCIM, president, Sidecar Commercial Real Estate While Collin County continues to see massive residential projects in markets like Anna, Celina and Melissa, as well as major redevelopments of existing shopping and dining destinations, a closer look at the region’s economic drivers reveals a significant shift in the types of industries that are driving demand for new commercial projects. Housing remains a critical need for all of North Texas, one of the fastest-growing regions in the country. With that comes demand for revamped retail, restaurant and entertainment options that include a healthy mix of necessity and luxury users, as well as some basic demand for office space. The latter is already well-supported via the swaths of corporate relocations and regional workforce consolidations that have occurred in the area over the past five to 10 years. But those needs are fairly germane to any area that is experiencing rapid and substantial job and population growth. In addition to this activity, we now see new types of commercial tenants targeting Collin County. These include life sciences/biotech, supply chain/logistics and specialized healthcare uses. According to data supplied by the U.S. Bureau of Labor Statistics and analyzed and published in the Sidecar …

August 31, 2022

Market Reports Texas Texas Market Reports

Collin County, Texas Economy Evolves, Diversifies as New Commercial Users Emerge

by Taylor Williams August 31, 2022

August 31, 2022

Market Reports Retail Southeast Southeast Market Reports Virginia

Residential Growth in Scott’s Addition, Manchester Drive Richmond’s Retail Market

by John Nelson August 30, 2022

With a 20 percent increase in population in the City of Richmond over the past half decade, and more to come, the city still struggles to attract national retail tenants such as The TJX Cos., Williams-Sonoma and Ann Taylor LOFT, as well as other soft and hard goods users. What Richmond does not struggle attracting are breweries, distilleries, regional and local restaurant operators and many start-up retailers dipping their toes into the growing 22 to 35 demographic calling Scott’s Addition and Manchester home. The food-and-beverage scene in Greater Scott’s Addition is blowing up with the addition of restaurant operations such as ZZQ (rated the best BBQ in Richmond), Lucky AF (from EAT Restaurant Partners), Wood & Iron, Tazza Kitchen and the James Beard Award-winning Peter Chang’s. When coupled more than 15 breweries, distilleries and the city’s only meadery, this energy is attracting ‘retailtainment’ such as River City Roll, Bingo Beer, The Circuit, Tang & Biscuit, Movieland by Bow Tie Cinema and Brambly Park. TRP (Thalhimer Realty Partners), Historic Housing (Louis Salomonsky’s firm) and Capital Square 1031 are local companies leading the developments, and Greystar and Bonaventure have come in from out of town to plant their flag as well. The …

August 30, 2022

California Market Reports Office Western Western Market Reports

Orange County Office Tenants Seek Instagram-Worthy Environments to Collaborate

by Jeff Shaw August 26, 2022

By Mike Adams, Managing Director, Stream Realty Partners The state of office is transitioning to a desire for dynamic spaces. Tenants in the Orange County office market are gravitating toward assets that act and function like hotels. They are seeking out the newest buildings and the most unique office environments. This is evidenced through leasing activity being the strongest in the Irvine/Tustin Legacy and Irvine Spectrum submarkets. Employers are looking for a reason to bring their workforce back to the office and are recruiting high-caliber employees. One way to do this is through office space. Creative office space is still in high demand — and won’t likely change soon. Companies focused on employee retention want to create an “Instagram-worthy” type office environment. They are looking for office space that will create a buzz and function as a recruiting tool. Office buildings are unique assets that facilitate collaboration, culture and training. This interest in new development signifies a flight to quality of office assets — for landlords and tenants alike. Several trends related to the desire for quality include: Hotelization — office spaces that act and function as hotels Biophilic design — the concept of connecting a building with nature Proptech — using innovative technology and …

August 26, 2022

Market Reports Mixed-Use Texas Texas Market Reports

More Than A Cliche: How Frisco Has Become the Ultimate Live-Work-Play Suburb

by Taylor Williams August 24, 2022

By Chris McCluskey, vice president of development, VanTrust Real Estate; and Robert Folzenlogen, senior vice president of strategic development, Hillwood In the past decade, the popularity of “live-work-play” developments has skyrocketed, making the concept a somewhat overused cliché in the commercial real estate world. However, the reasoning behind the acclaim remains true — people love convenience and a sense of community. And “live-work-play” is the reason that cities like Frisco that are located outside dense urban cores have thrived. According to the U.S. Census Bureau, Frisco’s population has grown by 71 percent over the last decade, consistently ranking as one of the fastest-growing cities in the nation. But this growth did not happen overnight; rather, a combination of ideal location and elected leaders’ vision has driven much of Frisco’s success. By prioritizing all real estate classes — office, residential, retail — Frisco has been able to find the right balance between bustling urban amenities and the serene background of suburbia, making it one of the most competitive landscapes today and for the foreseeable future. A Balanced Approach Suburbs are no longer known for just their family appeal, although this feature still remains a high priority for many households. Young professionals …

August 24, 2022

Market Reports Mixed-Use Texas Texas Market Reports

More Than A Clichè: How Frisco Has Become the Ultimate ‘Live-Work-Play’ Suburb

by Taylor Williams August 24, 2022

August 24, 2022

Market Reports Multifamily Southeast Southeast Market Reports Virginia

How Will the Richmond MSA Fare as Multifamily Buyer-Seller Price Gap Takes Shape?

by John Nelson August 23, 2022

Similar to the early stages of the COVID-19 pandemic in 2020, a gap has started forming with price expectations between apartment owners and investors. The price disparity at the start of the pandemic was driven namely by market uncertainty, adjustments to underwriting assumptions and increases to lender and insurance escrow requirements. As the pandemic played out, we saw a mass exodus from denser gateway cities, an influx of government stimulus money and a phasing out of state-specific stay-at-home orders that allowed the economy to open back up. Capital moved away from the retail and hospitality industries hit the hardest, with the multifamily sector reaping the benefit. The second half of 2020 saw a dramatic rise in rents, occupancy and new lease and renewal signings. These trends led to a calming of the debt and capital markets, paving the way for the price gap between buyers and sellers to evaporate as an unprecedented wave of investment flooded into the multifamily space, with 2021 hitting a new high of $213 billion of investment volume, well above the previous peak of $129 billion in 2019, according to Yardi Matrix data. Now midway through 2022, we’re seeing a buyer-seller price gap begin to take …

August 23, 2022

Market Reports Multifamily Oregon Western Western Market Reports

Portland’s Multifamily Market Positioned to Weather the Storm

by Jeff Shaw August 19, 2022

By Jordan Carter, Executive Vice President, Kidder Mathews Much like the city itself, Portland multifamily owners are no stranger to adversity — whether that refers to the weather, news media or the instability of today’s economy. There’s no doubt the rising interest rate environment will have an impact on the lending market for both refinances and sales in the short-term, but the good news is market fundamentals in the Portland metro remain solid. At 4.53 percent, our vacancy rate sits well below the national average of 4.98 percent, per CoStar. The average apartment rent is now $1,600 per month, thanks to year-over-year rent growth of 8.5 percent, which CoStar projects to remain near 5 percent for the next couple years. New construction, which peaked at nearly 13,000 units in 2018, has slowed dramatically due to legislative and policy changes that have disincentivized developers. These challenges have been magnified by elevated material costs and an arduous permitting process. Year-over-year deliveries of 4,000 units illustrate the dramatic slowdown, as they’re well below the supply needed to meet a demand of more than 10,000 new units annually. The hot single-family home market also continues to push prospective home buyers out of the market. …

August 19, 2022

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