Southeast Market Reports

Tech Firms are Bringing Atlanta’s Office Market Into the Modern Age

by John Nelson January 18, 2016

Atlanta’s office market offers key factors that are harder to come by in other top markets: stability and top universities. Because the city is so diverse, it is not reliant on any one type of business for survival. It’s less volatile, which is one factor that has allowed us to come back from the Great Recession, although slowly, in a more firm and healthy fashion. In line with the majority of the country, Atlanta is currently a landlord’s market. With continued occupancy gains and a shortage of new product, rents are increasing and will continue to do so until additional Class A product delivers and the price gap between existing buildings and new construction gets smaller. Overall office vacancy in Atlanta is as its lowest point in 14 years, with strong growth in rental rates. However, Atlanta still offers the best deal overall, as tenants, developers, owners and investors are able to take advantage of its low cost of living and operating costs, excellent quality of life and a rich local talent pool. Driving the Atlanta office market, we see the technology, advertising, media and information (TAMI) sector. CBRE recently released two tech-related reports that rank the top tech talent …

January 18, 2016

Georgia Industrial Market Reports Southeast Southeast Market Reports

Atlanta’s Industrial Market Continues Historic Pace of Sales, Leasing Activity

by John Nelson January 11, 2016

Atlanta’s industrial market is hotter than the proverbial pistol. Second-quarter activity set a single-quarter record with more than 18.2 million square feet leased or sold. When added to the activity from the previous three quarters, Atlanta strung together more than 59.6 million square feet of completed transactions. This represents the second highest activity level ever recorded for a four-quarter period. There was more than 6.3 million square feet of positive net absorption. Combined with the previous three quarters, Atlanta shows a total of more than 19.7 million square feet of positive net absorption for the last four quarters. For the second quarter, the availability rate dropped one-tenth of a percent to 14 percent — the lowest it has been since the fourth quarter of 2000. And just four to five years ago, the overall availability rate was above 20 percent. Development and construction are absolutely booming. With more than 7 million square feet of new construction recorded during the second quarter, the market also set a record for new construction in a single quarter. When looking at the four-quarter total, we see more than 18.8 million square feet of new construction — a level not seen since 1998. Of that …

January 11, 2016

Kentucky Market Reports Retail Southeast Southeast Market Reports

Major Infrastructure Projects Will Benefit Louisville’s Two-State Retail Market

by John Nelson January 4, 2016

The retail market for Louisville has continued to improve over the past year. New ground-up developments, which have been virtually nonexistent the past five years, are now open for business. Vacancy rates are falling, new tenants are entering the market, and retail investment sales continue to be in high demand. The $2.5 billion Louisville- Southern Indiana Ohio River bridges project is on track for a 2016 opening. New developments in downtown and northeast Louisville, as well as Southern Indiana, are looking to capitalize on the new infrastructure. GBT Realty is looking to expand its presence in the market with a proposed 220,000-square-foot joint venture project across the river in Jeffersonville, Ind. The site is located within in the 170-acre master-planned Jefferson Town Center on Veterans Parkway. Menards is opening a new 200,000-square-foot property this fall across the street from GBT’s proposed development. In addition to GBT Realty’s newly opened Middletown Commons and Jefferson Commons in Louisville, the three projects are from developments that were planned before the Great Recession and now have new life. The Outlet Shoppes of the Bluegrass, located in Simpsonville, Ky., has been a major success since opening in late 2014. After just six months, an expansion …

January 4, 2016

Kentucky Market Reports Retail Southeast Southeast Market Reports

Louisville Sees Wealth of Retail Leasing, Development Activity Across Metro Area

by John Nelson December 28, 2015

Louisville’s retail market continues to experience a shortage of space in high-demand markets in spite of several new developments opening over the past year. During this period, two major retail developments have been completed with several smaller projects under construction or in the planning stages. Second-generation big box vacancy is virtually non-existent and finding quality shop space is becoming equally challenging. As a result, rents have escalated to historic highs. The most notable additions to the Louisville market are two neighborhood centers developed by Brentwood, Tenn.-based GBT Realty Corp. Nestled amongst a rapidly expanding residential community and PGA’s notable Valhalla Golf Club in eastern Louisville, the 240,000-square-foot Middletown Commons is anchored by Hobby Lobby, Academy Sports + Outdoor, Ross Dress for Less and Liquor Barn. Jefferson Commons, located in south Louisville, is anchored by Academy Sports + Outdoor, Hancock Fabrics, HH Gregg, Michael’s, Liquor Barn and several fast-casual restaurant concepts. In western Louisville, BC Wood Properties added Hobby Lobby and Goody’s stores at the 350,000-square foot Dixie Manor Shopping Center. Southwest of the city’s central business district, the redevelopment of Dixie Valley Shopping Center expanded its footprint to include additional soft goods retailers such as Marshalls, Ross Dress for Less, …

December 28, 2015

Kentucky Market Reports Multifamily Southeast Southeast Market Reports

Louisville Multifamily Rents, Occupancy Maintain Forward Momentum

by John Nelson December 21, 2015

The Louisville multifamily market has consistently demonstrated strong, favorable market fundamentals, which has drawn significant interest in this growing riverfront city. Since 2010, the market has seen 19.8 percent rent growth and continually posted occupancy gains. This momentum resulted in a record amount of multifamily transactions in 2014 and continues to fuel investor demand today. This momentum in the multifamily sector is happening not only in Louisville, but across the U.S., according to CBRE Research. Overall demand for rental housing continues to be driven by demographic-led household formation and a deepening preference for rental vs. owner tenure. Supply continues to grow briskly and rent and revenue growth are accelerating. Additionally, a recent CBRE multifamily study found that the national homeownership rate is 63.4 percent — its lowest level since 1967. The report also discovered that the national rent growth has reached its strongest year-over-year gain in nine years. And we don’t expect this trend to level off anytime soon. During the first half of 2015, the Louisville market demonstrated strong fundamentals with increasing rents and occupancy. Between 2014 and 2015, the annual market-wide rent growth was 3.4 percent, bringing the average rent to $786, or $0.86 per square foot. The …

December 21, 2015

Industrial Kentucky Market Reports Southeast Southeast Market Reports

Leasing is Up 40 Percent from 2014 in Louisville’s Industrial Sector

by John Nelson December 14, 2015

Louisville’s industrial market continues to impress as it has successfully navigated recessionary times to the now current brisk market with solid activity. Even within those leaner times of 2009 and 2010, Louisville grew its occupied footprint by approximately 1.6 million square feet with perhaps a recipe that includes its beneficial geographic location and infrastructure, diverse manufacturing and logistics economy buffeted by UPS Worldport and Supply Chain Logistics, and aggressive state incentives provided by Kentucky and adjacent neighbor Indiana. The I-65 corridor is currently, and has been, white hot over the last 15 years. Louisville, like many similarly sized cities with populations over 1 million, has developed to its outer edges and industrial development is now spilling into smaller adjacent communities such as Shepherdsvillle, Ky., and Jeffersonville, Ind., both of which no longer resemble their former industrial selves. National and international developers like Prologis, USAA, Dermody, Exeter, DCT, Pinchal and Welsh, along with local developers such as Main Street Realty, Capstone, America Place and Crossdock, have found these communities and the I-65 corridor not only ripe with opportunity, but flush with tenants. On the Louisville side of the Ohio River, current speculative construction along the corridor includes more than 1.4 million …

December 14, 2015

Industrial Market Reports Southeast Southeast Market Reports Virginia

Richmond’s Industrial Market Fires on Most Cylinders, Save for Large Spec Projects

by John Nelson December 7, 2015

Greater Richmond’s industrial market is as strong as it has been in a generation. Given the overall growth of the economy, including industrial employment and investment, it appears that the engines driving industrial economic growth will remain steady and the need for industrial real estate will continue to be steady. Greater Richmond’s industrial market is moving fast and on most cylinders, with the only laggard being pure speculative development of high-bay large block industrial and small incubation flex product. All other cylinders are pumping, including industrial and flex leasing, design build-to-suits, land sales, freestanding occupier building sales and investment sales. Absorption and general growth activity is coming not only from local existing companies and start-ups, but also by companies outside of the area looking to relocate or open additional facilities here. The flavor of the demand has been relatively diverse reflecting the Greater Richmond area’s stable economy and Mid-Atlantic location with its superior logistic opportunities. Economic Trends Greater Richmond’s population is nearly 1.3 million people, and total employment is more than 650,000 in the Richmond metro area. The diverse economy includes 10 Fortune 1000 headquarters; pharmaceutical, chemical, biotech and other 21st century manufacturers; financial and information technology services; Fifth District …

December 7, 2015

Market Reports Retail Southeast Southeast Market Reports Virginia

Grocery Stores, Restaurants, Fitness Are Driving Richmond’s Retail Market

by John Nelson November 30, 2015

This year is shaping up to be very exciting and productive for the Richmond retail market. The Richmond retail market has started at a brisk pace for the first half of 2015, similar to the end of 2014 as it absorbed 111,889 square feet. The vacancy rate has continued to decline over the past 12 months as well. The overall retail vacancy rate in Richmond tightened to 6.6 percent, a 50 basis point improvement over last year. The main drivers of retail activity throughout the Richmond MSA continue to be grocery stores, fitness centers and restaurants. Early this year we saw the commencement of construction at two Wegmans-anchored developments in Richmond, one in Short Pump and another in Midlothian. The Midlothian Wegmans will anchor the new Stonehenge Village and is on pace to open in early 2016. The Short Pump Wegmans will join Cabela’s in the new West Broad Marketplace, a 400,000-square-foot development on the western edge of Short Pump. There has also been solid activity in the market from several other grocers, including Walmart Neighborhood Market and Aldi. Each of these concepts has opened four new stores in the market. Another grocer poised to enter the market is LIDL, …

November 30, 2015

Market Reports Multifamily Southeast Southeast Market Reports Virginia

Richmond’s Multifamily Market Couldn’t Look More Attractive to Investors

by John Nelson November 23, 2015

The Richmond metropolitan area, with a population of 1.3 million, is bursting with multifamily development. The growing MSA contains more than 72,000 apartments units (45 percent Class A) and has 2,018 units under construction with another 5,826 in various stages of pre-development. On top of all this activity, the overall market occupancy remains at 96 percent. The fuel for these conditions comes from the many amenities in the market, from the University of Richmond and a robust sports scene to the proximity to Atlanta, the Atlantic coast and Washington, D.C., as well as the encouraging employment picture. The city’s unemployment stands at 5 percent compared to the U.S. average of 6.3 percent; since 2000 the city’s population has grown by nearly 15 percent. These conditions allow property owners to leverage this diverse and sustainable market for multifamily investments. Richmond development also benefits from the attractive interest rates, which remain low despite having climbed 80 basis points since late January. Along with monitoring this upward trend, news earlier this month from the Federal Reserve of a rate hike will serve as a caution sign for investors. Whether we see this hike in the next couple of months, or not until 2016, …

November 23, 2015

Market Reports Multifamily Southeast Southeast Market Reports Virginia

Apartment Supply in Richmond’S CBD Attracts Young, Economically Powerful Residents

by John Nelson November 16, 2015

Richmond has become a multifamily safe haven with unemployment rates below the national average and the second-best annual rental returns in the nation at 20.42 percent. Richmond’s high annual returns are due in large part to its population. The city has become a mecca for young adults as 32.2 percent of the population is in its 20s and 30s — well above the national average of 22 percent. This population’s drive for an urban, walkable lifestyle is generating a great deal of development in the CBD, as well as the Manchester submarket where Virginia Commonwealth University’s (VCU) Institute for Contemporary Art is located. VCU’s art institute is the No. 1 art and design school in the country, and continues to draw in Millennials looking to take advantage of the open and historic downtown district surrounding the James River. Richmond’s flourishing, younger population is demanding adaptive re-use and new development and developers in Richmond are answering the call. Areas such as Scott’s Addition, Shockoe Bottom and Manchester have all seen new mid and high-rise developments in recent months that are attracting a plethora of new tenants. Highlights of Richmond’s apartment market include: • 1,000 units are currently under construction with an …

November 16, 2015

Newer Posts

Older Posts