Southeast Market Reports

Charlotte’s Industrial Market Expected to Close Another Robust Year of Leasing

by John Nelson August 30, 2021

The Charlotte industrial market is seeing significant tenant demand and investment activity at mid-year 2021 as the market begins to return to normalcy after the disruption during the early days of the pandemic. Like many other Southeastern industrial markets, Charlotte saw a lag in activity through the second and third quarters of 2020. One year later, the impacts of the pandemic continue to burn off, creating an almost insatiable appetite for modern warehouse and distribution space. Since the start of the year, the market has seen a strong increase in overall activity as local economies continue to open up, employment levels rebound and businesses move forward with decisions about space utilization. Tenants in the e-commerce, consumer goods, retail and light manufacturing sectors are particularly active. While the market finished 2020 with nearly 5.3 million square feet of net absorption, a figure that outpaced 2019’s total of 2.7 million square feet and was on par with the nearly 5.4 million square feet absorbed in 2018, 2021 is expected to reach a net absorption for the calendar year that is equal or greater than 2020. Many tenants expanding in or entering the market are taking mid- to large blocks of space, a …

August 30, 2021

Data Centers Industrial Life Sciences Market Reports North Carolina Southeast Southeast Market Reports

Life Sciences Firms Dominate Activity in Raleigh-Durham’s Industrial Market

by John Nelson August 23, 2021

It seems as though we have recently seen significant weekly announcements about investment and job creation by major U.S. companies into the Research Triangle Park region, the area situated between the cities of Raleigh and Durham. For instance, tech titans Apple and Google declared plans to establish major engineering hubs in the region, adding heat to an already dynamic market. It is common knowledge that the Triangle area is respected for its large, highly educated workforce thanks to top-ranking colleges and universities, including Duke University, North Carolina State University and University of North Carolina at Chapel Hill. Wake Tech, North Carolina’s largest community college, also serves as a vital engine, providing the region’s workforce with STEM candidates. These institutions supply existing and expanding businesses with an impressive talent pool. Theses factors, along with a business-friendly economic climate, have grown the Research Triangle into one of the nation’s largest research centers. Although local headlines continue to buzz with real estate business news, the Raleigh-Durham industrial market has witnessed steady real estate investments from life sciences and R&D businesses for decades. Over the past 24 months, however, demand for life sciences space has had a dramatic impact on traditional flex/light industrial users …

August 23, 2021

Market Reports Multifamily North Carolina Southeast Southeast Market Reports

Charlotte’s South End Remains ‘Go-To’ Submarket for Young Renters

by John Nelson August 16, 2021

Charlotte’s South End district has firmly established itself as one of the most dynamic millennial urban submarkets in the Sun Belt. It is increasingly on par with the most thriving areas in other growth cities such as Atlanta, Austin and Nashville and is becoming a 24-hour neighborhood with dining, nightlife and high-end jobs. Charlotte is one of the few cities in the region that has both a true city center as well as a relevant mass transit system. The city’s LYNX Blue Line, which runs from Interstate 485 to the University of North Carolina at Charlotte’s main campus, has proven to be very meaningful for the local multifamily market. LYNX was the catalyst driving South End’s emergence and gives the neighborhood its own heartbeat as renters can commute to Uptown for work or UNC Charlotte for class. Developers are taking note with several apartment projects and mixed-use developments underway in the area, including Broadstone Queen City and Haven South End. As South End has grown into a more dynamic district, Charlotte is becoming an even more attractive destination for recent college grads who are looking to work in the city’s established financial sector, as well as for firms like Lending …

August 16, 2021

Market Reports North Carolina Office Southeast Southeast Market Reports

A City on the Rise: Charlotte Office Market Poised for Growth and Recovery

by John Nelson August 9, 2021

Last year posed many challenges for Charlotte’s office market, as companies continued to delay making decisions about their office space needs. In the fourth quarter, leasing velocity had slowed, with limited deal activity driven largely by lease expirations. But the city still scored several corporate relocations and expansions, faring well compared to other major cities throughout the country. Fast-forward to June 2021, and the light at the end of the tunnel is getting brighter as more occupants set re-entry plans for this fall. This is a transformative year for Charlotte. Commercial Café ranked the Queen City as No. 5 in the United States for the most anticipated office deliveries in 2021 with more than 4.1 million square feet delivering in the metro area this year. Uptown added to its skyline with the addition of 366,000 square feet at Legacy Union Two, the completion of the 742,000-square-foot Ally Charlotte Center, Honeywell’s 330,000-square-foot corporate headquarters delivering later this fall and the 156,415-square-foot FNB Tower delivering this summer. At the end of the first quarter, new construction in Uptown was more than 82 percent preleased. And as more tenants seek out highly amenitized and efficient space, new construction is expected to be the …

August 9, 2021

Florida Market Reports Retail Southeast Southeast Market Reports

Miami’s Restaurants are Back on Track, Entertainment and Big Box Users are Still Healing

by John Nelson August 2, 2021

What a difference a year makes! Retail real estate in Miami is not dead nor in the depths of huge vacancy rates and declining rents; current vacancy rate is 4.3 percent and rental rates have slipped by 0.1 percent over the past year. Let’s explore several indicators of the value and use of the current state of the shopping center industry, restaurant space, entertainment space and big-box retailers. South Florida restaurant space, due to COVID-19 restrictions, was not open to customers over the last 18 months. Many anticipated only a few restaurants to survive with lots of second-generation restaurant space expected to be given back to landlords. Due to the U.S. Small Business Administration’s Paycheck Protection Program and restaurateurs flocking to Miami from across the country — mainly the Northeast, especially New York City — the glut of restaurant space vacancy never occurred. When there is available second-generation restaurant space, it gets leased quickly. South Florida has seen national chain quick-service restaurants (QSR) looking for ghost kitchens which restricts customers to pick-up and delivery. Restaurant sales are back to pre-COVID-19 levels beginning the second quarter this year. The restaurant market appears to be healthy, again. News is not so great …

August 2, 2021

Florida Market Reports Office Southeast Southeast Market Reports

Miami Office Rent Growth Influenced by Influx of Tech Firms, New Capital Sources

by John Nelson July 25, 2021

The past year has been a long and winding ride, and some unexpected trends have been taking place in the Miami office market, between the onset of the COVID-19 pandemic and through its recovery to date. Logically, one would expect that an ongoing pandemic keeping corporate offices closed and employees working from home would negatively affect occupancy levels and lead to a deceleration in asking rents for office space. On the contrary, the Miami office market has remained solid, and while the area is a natural draw for tourism and entertainment, an increasing number of companies also recognize it as a sought-after location from which to operate their businesses. Tech’s influence on rents Miami has been one of the most active office markets in the nation thus far in 2021. While office markets in the Northeast and California remain partly closed due to several public health initiatives and related business constraints, Miami’s pro-business culture — coupled with Florida’s lack of state income taxes and business development efforts rolled out by Miami Mayor Francis Suarez and the Miami-Dade County Beacon Council — have ensured that the city’s economic engine kept running. Case in point, not only did Class A rental rates …

July 25, 2021

Florida Market Reports Multifamily Southeast Southeast Market Reports

South Florida’s Reliable, Robust Apartment Market is a Safe Haven for Investors

by John Nelson July 18, 2021

South Florida multifamily fundamentals are, and will continue to be, the single biggest driver of performance in the market. Strong rent collection and occupancy performance through the pandemic, population and household growth, low homeownership rates, increasingly expensive home prices, an improving job market, higher wage growth, limited land and a wonderful lifestyle all contribute toward sustainable long-term growth. Demand for multifamily rentals will increase post COVID-19 as South Florida becomes a hotbed of population growth from people migrating from other states due to the business-friendly environment and tele-workers who are choosing South Florida as their new home. In fact, household formations in South Florida are expected to increase more than 44,000 each year over the next five years. Assuming this projection materializes, at 60 percent homeownership rate (consistent with historic homeownership rates) represents over 17,000 new renters per year in South Florida. Investment sales skyrocket In the span of less than 12 months, the South Florida multifamily market went from near-record sales activity to virtually none before rebounding again to close the year. Last year ended with 254 multifamily sales totaling $3.1 billion. Despite almost six months of virtually no investment activity from April through September, total sales volume was …

July 18, 2021

Georgia Market Reports Office Southeast Southeast Market Reports

Atlanta’s Office Market Trending Upward as Workers Set to Return En Masse

by John Nelson July 11, 2021

Following a challenging year in 2020, momentum in the Atlanta office market is beginning to trend upwards. The COVID-19 pandemic forced office users and owners to sideline their business plans and made tenants reevaluate their office needs. As government restrictions have lifted and vaccines for COVID-19 have become widely available, many companies in Atlanta are going back to the office and the “new normal” for the workplace is here. There have been several notable office announcements made in Atlanta this year. Two large technology corporations announced they were expanding their plans for major hubs in Atlanta, and companies including Adecco and Minute Maid announced plans to make Atlanta their headquarters or a hub. In total, there have been over 20 major relocation or expansion announcements in the past year, accounting for more than 3 million square feet of recent or anticipated near-term absorption. Atlanta’s most significant office lease in 2021 has been Global Payments’ 206,542 square-foot commitment at 5995 Windward in the North Fulton submarket. Other notable leases include Soliant Health’s 87,419-square-foot deal at Summit at Peachtree Parkway in the Peachtree Corners submarket and ServiceMaster’s 53,440-square-foot lease at One Glenlake in the Central Perimeter submarket. Other companies including Centene and …

July 11, 2021

Georgia Market Reports Restaurant Retail Southeast Southeast Market Reports

Ambitious Mixed-Use Projects are Adding New Retail Density Around Atlanta

by John Nelson July 5, 2021

Atlanta is a city that is always evolving. Even prior to the pandemic, rapid change seemed to be the one constant thing about the market. This continues to be true today; from downtown to the furthest suburban reaches, Atlanta’s retail landscape is vibrant with new brands and ambitious projects. One of the most notable areas of growth in greater Atlanta is the expansion of single-tenant operators, especially quick-service restaurants. New national players such as Whataburger and Raising Cane’s are entering the metro Atlanta market, as other popular chains such as Freddy’s Frozen Custard & Steakburgers and gusto! continue to expand. Evolving faster than restaurants, however, are discount retailers. Forbes recently noted that The TJX Cos., Ross Dress for Less, Burlington and Five Below are among the chains with active expansion plans. Dollar Tree also recently announced Family Dollar Tree, a new concept that combines its flagship brands into a hybrid shop for more rural communities with less convenient access to necessity retail. While some grocers such as Kroger and Sprouts Farmer Market have slowed growth, Publix is picking up the slack, opening and planning multiple locations throughout greater Atlanta. German discount grocer Lidl, which opened its first U.S. store just …

July 5, 2021

Build-to-Rent Georgia Market Reports Multifamily Southeast Southeast Market Reports

Investors are ‘Swarming’ Atlanta’s Multifamily Market, Driving Pricing Up

by John Nelson June 28, 2021

Atlanta is a hot spot for investing in multifamily assets as the market emerges from the COVID-19 pandemic. The apartment market’s fundamentals, including occupancy and rent growth, have held up considerably well, making the market extremely attractive to buyers. Because the Atlanta market has an abundance of capital looking to be deployed, prices are being driven up significantly and cap rates driven down. Multifamily has outperformed many other commercial real estate sectors during the pandemic, considered a “hot-ticket asset class” by investors, which leads to new capital swarming the Atlanta apartment market. Many multifamily properties are now routinely trading at a sub-4 percent cap rate, indicative of the vast amount of available capital and the confidence that investors have in the product type. However, rather than clearing the market and searching for as many prospective buyers as they can, sellers are looking at a smaller subset of dominant, well-known investors that they know will deliver and get the transaction done. They are seeking six to 12 well-recognized, established players that can execute a deal at top prices. It is an extremely competitive process, and all buyers know they have to swing high on pricing. Oftentimes, no one broker is selected …

June 28, 2021

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