Denver's retail market has staged a quiet, yet strong comeback, giving the sector runway to withstand a potential slowdown in the year ahead. Contributing to this comeback was the significant lift in consumer spending coming out of the pandemic. Denver's retailers now have a fresh set of headwinds to contend with in 2023. High inflation, rising consumer debt, and a high interest rate environment are weighing on purchasing power, creating challenges for local retailers. But today's retail market is entering into this uncertain season from a position of strength.
This retail snapshot of Oklahoma City is a survey of over 300 retail spaces within the Downtown Business Improvement District. Areas included are Midtown, Automobile Alley, West Village, City Center, Deep Deuce and Bricktown. Food and beverage currently dominate downtown.
The retail market, both nationally and locally, appears to be nearing an inflection point that will see the market move from surprising growth to more moderate growth and activity. Since the start of the recovery, retail has gained back all it lost in sales and then some. Occupancy has increased and there has been a significant influx of new tenants. Per CoStar, national retail vacancy sits at 4.2 percent near its all-time low.
Oklahoma City’s office market has experienced a dynamic first half in 2023, offering a blend of opportunities and challenges across its submarkets. The total market vacancy rate, which measures the unoccupied space in the market, has decreased from 25.2% at the year-end of 2022 to 24.7%. On the surface this would appear to be a positive sign, however, the overall absorption for the office market was a -11,146 SF. There is generally an inverse relationship between absorption and the vacancy rate, but this relationship can be affected by the removal of office buildings from the data set that were recategorized.
Although demand has returned since the start of 2023 after falling in the second half of 2022, household formation has been stymied by a combination of persistent inflation, rapidly rising interest rates, and rising unaffordability.12 Month Deliveries in SF: 2,446 12 Month Net Absorption in SF: 845 Vacancy Rate: 3.5% 12 Month Rent Growth: 3.0
In the first half of 2023, Bed Bath & Beyond and Tuesday Morning announced they were closing all of their San Diego area stores, impacting more than 300,000 SF of retail space.12 Month Deliveries in SF: 169 K 12 Month Net Absorption in SF: 114 K Vacancy Rate: 4.3% 12 Month Rent Growth: 4.9%
Leasing activity has moderated over the past several quarters. Many larger space users have become more cautious amid concerns and are reportedly trying to renew instead of actively seeking new space.12 Month Deliveries in SF: 2.9 M 12 Month Net Absorption in SF: (854 K0 Vacancy Rate: 4.4% 12 Month Rent Growth: 8.7%
San Diego's office market is supported by a mix of defense contractors, healthcare providers, life sciences firms, and tech companies. Several top universities, including UC San Diego, the University of San Diego, and San Diego State University, provide a talent pool of job-seeking graduates and collaborative work with firms and research institutes.12 Month Deliveries in SF: 270 K 12 Month Net Absorption in SF: (997 K) Vacancy Rate: 11.3% 12 Month Rent Growth: 1.6%
Second quarter 2023 closed with a direct vacancy rate of 21.42%, an overall vacancy rate of 23.81%, and an average asking direct rental rate reported at $18.66 psf. In June, the Michigan unemployment rate was recorded at 3.6%, a decrease of 0.7 percentage points compared to this time last year, while the U.S. unemployment rate was recorded at 3.6%. Although inflation persists, interest rate hikes have remained consistent over the past year, and as employers target cost cutting measures, the labor market continues to maintain strength with fewer Americans applying for jobless benefits. 253,000 job openings occurred in April, 339,000 openings in May and a slight decrease in June to 209,000 openings, closing the quarter with 9.8 million total job openings in the U.S. In April, U.S. consumer confidence declined for the 3rd time in four months and again in May as individuals continue to become more discouraged by inflation, and by yet another increase of the key interest rate by the Federal Reserve totaling a quarter point to the highest it’s been in 16 years; however, they have indicated there may be a pause in further increases after 10 rate hikes which have had a costly impact on both businesses and consumers. Consumer price growth slowed in May rising only 0.1% from April, while mortgage rates approached a 7-month high, the quarter closes on an uneasy note as to how the remaining half of the year will unfold.
Second quarter 2023 closed with a direct vacancy rate of 3.69%, an overall vacancy rate of 3.95%, and an average asking direct rental rate reported at $7.36 psf. In June, the Michigan unemployment rate was recorded at 3.6%, a decrease of 0.7 percentage points compared to this time last year, while the U.S. unemployment rate was recorded at 3.6%. Although inflation persists, interest rate hikes have remained consistent over the past year, and as employers target cost cutting measures, the labor market continues to maintain strength with fewer Americans applying for jobless benefits. 253,000 job openings occurred in April, 339,000 openings in May and a slight decrease in June to 209,000 openings, closing the quarter with 9.8 million total job openings in the U.S. In April, U.S. consumer confidence declined for the 3rd time in four months and again in May as individuals continue to become more discouraged by inflation, and by yet another increase of the key interest rate by the Federal Reserve totaling a quarter point to the highest it’s been in 16 years; however, they have indicated there may be a pause in further increases after 10 rate hikes which have had a costly impact on both businesses and consumers. Consumer price growth slowed in May rising only 0.1% from April, while mortgage rates approached a 7-month high, the quarter closes on an uneasy note as to how the remaining half of the year will unfold.
The Chicago suburban office market showed signs of strength through the second half of 2022 as rental rates increased, absorption levels turned positive, and vacancy rates stabilized at approximately 27%. Although the vacancy rate is at a record high, the data remains distorted by zombie offices (typically outdated corporate campuses); one of which was sold in October for more than $230 million. The 1.4 million-squarefoot- campus in Northbrook, formerly the long-time home of Allstate, is being redeveloped into an industrial mega site. Developers must determine the highest and best use for these vacant office campuses, whether into more digestible-sized office product or into an entirely new asset class. These decisions will help mitigate oversupply issues while contributing to the long-term stability of Chicago’s suburban market.
In Q4/22, Chicago’s downtown office market vacancy rates and rental rates remained relatively unchanged compared to Q3/22. Absorption levels deteriorated, however, totaling 800,000 square feet of negative net absorption through the quarter. As a result, absorption levels through 2022 were negative 1.2 million square feet—an improvement relative to the negative 3 million square feet seen in 2021.
A number of leases were signed during the fourth quarter. First in Livonia, Cabinetworks Group, LLC inked a deal totaling 89,543 sq. ft. of Class B office space located at 20000 Victor Parkway. In Bingham Farms, Hondros College of Nursing signed a deal for 48,035 sq. ft. of Class B office space located at 30700 Telegraph Road in the Bingham Office Center. Lastly, in Ann Arbor, Tetra Tech, Inc., a global provider of consulting and engineering services leased 21,890 sq. ft. located at 1136-1138 Oak Valley Drive in the Valley Ranch Business Park.
Fourth quarter 2022 closed with a direct vacancy rate of 3.74%, an overall vacancy rate of 4.24%, and an average asking direct rental rate reported at $7.20 psf. In December, the Michigan unemployment rate was recorded at 4.3%, a decrease of 1.3 percentage points compared to this time last year, while the U. S. unemployment rate was recorded at 3.5%. Despite the Federal Reserve’s intentions to slow the demand for labor, wage gains and inflation with their continued interest rate hikes, the number of U.S. job openings in December was recorded at 11M, up from 10.46M in November as employers continued hiring at a solid pace. During fourth quarter, the U.S. economy grew by 2.9% and 2.1% throughout 2022, recording six straight months of stable growth. In December, indicators pointed towards the easing of inflation as consumer spending decreased by 0.2% from November along with a decline in consumer prices. It is expected the Federal Reserve will raise the key interest rate during 2023, with the number of increases to be determined. As inflation reached a 40-year high, seven interest rate increases were recorded during 2022 with the final increase of the year by half a point reaching the highest level in 15 years. Inflation remains one of the top economic concerns as consumers remain cautious, re-evaluate their spending habits and outlook towards saving and borrowing.
SUPPLY, MEET DEMAND. Multi-Tenant property has had its hay-day since first dropping N of 45% of vacancy from 2020-2021 (14.93% vacancy to 8.38%). With the vacancy rate bottoming out at a record shattering figure of 4.64% in 2022, it appears we may be headed towards stabilization. As any reasonable investor should expect, this sub-sect of the Industrial Market has seen its fair share of renovation and a large amount of spec construction. This race to meet the demand in tandem with a questionable political and economic outlook for the Country has been met with a marginal raise in vacancy to 5.42%. While this figure doesn’t swing the needle to indicate a over-supply in the market, it isn’t something to ignore either. With the Medical Cannabis industry tightening regulations and interest rates rising, this percentage may continue to creep up for a time. Regardless, this market is showing resilience and we believe it will continue to do so.
The multi-family market, more than any other, has been driven by the money funneled into the economy during the course of the pandemic. The shear level of money provided to renters through various pandemic programs combined with the broader economic stimulation led to some of the largest multi-family rent increases in our history. Oklahoma City has historically seen slow but steady rent growth; two to three percent annually. You could always count on it. In 2021, rent increased 12 percent. The increase was cut in half but still historically high in 2022, at 6 percent, with most of this moderation coming in the second half of the year. Clearly this wasn’t sustainable. What isn’t clear is where do we go from here.
Third quarter 2022 closed with a direct vacancy rate of 20.71%, an overall vacancy rate of 22.46%, and an average asking direct rental rate reported at $19.16 psf. In June, the Michigan unemployment rate was recorded at 4.1%, a decrease of 0.5 percentage points compared to this time last year. In August, U.S. job openings declined to 10.1 million, the lowest since June 2021, while adding 528,000 jobs, more than double economist’s original estimates of 258,000 jobs. In September, the hiring pace slightly declined due to higher rates and slower company growth with 263,000 jobs added and an unemployment rate of 3.5%, a decrease of 1.3 percentage points compared to one year ago. Year to date the Federal Reserve has increased the interest rate five times. The Federal Reserve has announced they will continue to aggressively institute rate increases until inflation declines and are confident that balance among the economy is being restored. Wall Street closed out the month of September down 9.3%, the worst month since March of 2020. Interest rate hikes have taken a toll on the housing market as home prices have decreased at an accelerated rate, long-term mortgage rates increased for 6 straight weeks by the end of September, and a 30-year rate was recorded at 6.7%, the highest in 15 years. Consumers, employers and the overall market remain aware and cautious heading into the fourth quarter as anticipation builds as the year is ready to close out.
Third quarter 2022 closed with a direct vacancy rate of 3.53%, an overall vacancy rate of 3.95%, and an average asking direct rental rate reported at $6.98 psf. In June, the Michigan unemployment rate was recorded at 4.1%, a decrease of 0.5 percentage points compared to this time last year. In August, U.S. job openings declined to 10.1 million, the lowest since June 2021, while adding 528,000 jobs, more than double economist’s original estimates of 258,000 jobs. In September, the hiring pace slightly declined due to higher rates and slower company growth with 263,000 jobs added and an unemployment rate of 3.5%, a decrease of 1.3 percentage points compared to one year ago. Year to date the Federal Reserve has increased the interest rate five times. The Federal Reserve has announced they will continue to aggressively institute rate increases until inflation declines and are confident that balance among the economy is being restored. Wall Street closed out the month of September down 9.3%, the worst month since March of 2020. Interest rate hikes have taken a toll on the housing market as home prices have decreased at an accelerated rate, long-term mortgage rates increased for 6 straight weeks by the end of September, and a 30-year rate was recorded at 6.7%, the highest in 15 years. Consumers, employers and the overall market remain aware and cautious heading into the fourth quarter as anticipation builds as the year is ready to close out.
First quarter 2022 closed with a direct vacancy rate of 3.9%, an overall vacancy rate of 4.26%, and an average asking direct rental rate reported at $7.79 psf. In March, the Michigan unemployment rate was recorded at 4.4%, a decrease of 0.7 percentage points compared to this time last year. As the U.S. job market nears full recovery, 431,000 jobs were added in March, the number of Americans applying for unemployment benefits reached a 52-year low, and the U.S. unemployment rate was recorded at 3.6%, a decrease of 2.4 percentage points compared to one year ago, the lowest rate since the beginning of the pandemic two years ago. However, U.S. inflation has surged to an increase of 7.9% over the past year currently standing at a 40-year high, long-term mortgage rates have risen to the highest they have been since 2019, while producer prices have increased 11.2% compared to one year ago due to higher energy costs leaving consumers around the country to feel the impacts, and U.S. confidence readings fell to the lowest level since 2011. The Federal Reserve announced plans to combat further inflation with increases to the interest rate, which has remained at zero since the beginning of the pandemic. In March, a 0.4% rate increase was issued with an advisory of six additional rate increases throughout 2022 totaling 1.9% and potentially 2.8% by the end of 2023 based on their median forecast, impacting higher loans for consumers and businesses.
First quarter 2022 closed with a direct vacancy rate of 20.59%, an overall vacancy rate of 22.00%, and an average asking direct rental rate reported at $19.39 psf. In March, the Michigan unemployment rate was recorded at 4.4%, a decrease of 0.7 percentage points compared to this time last year. As the U.S. job market nears full recovery, 431,000 jobs were added in March, the number of Americans applying for unemployment benefits reached a 52-year low, and the U.S. unemployment rate was recorded at 3.6%, a decrease of 2.4 percentage points compared to one year ago, the lowest rate since the beginning of the pandemic two years ago. However, U.S. inflation has surged to an increase of 7.9% over the past year currently standing at a 40-year high, long-term mortgage rates have risen to the highest they have been since 2019, while producer prices have increased 11.2% compared to one year ago due to higher energy costs leaving consumers around the country to feel the impacts, and U.S. confidence readings fell to the lowest level since 2011. The Federal Reserve announced plans to combat further inflation with increases to the interest rate, which has remained at zero since the beginning of the pandemic. In March, a 0.4% rate increase was issued with an advisory of six additional rate increases throughout 2022 totaling 1.9% and potentially 2.8% by the end of 2023 based on their median forecast, impacting higher loans for consumers and businesses.
Absorption over the fourth quarter totalled positive 86,000 square feet (sf).
Absorption for the fourth quarter totaled negative 41,000 square feet (sf).
The Beltline market witnessed a net negative absorption totaling 72,000 square feet (sf) during the fourth quarter.
After another quarter characterized by strong leasing activity, the industrial market’s positive trend continued with vacancy decreasing by another 0.50% in the fourth quarter to 6.52%.
Residential Land, Multi-Residential and Industrial sales led Calgary’s commercial real estate investment market in a continued recovery during 2017. Multi-Residential and Residential Land investments both grew more than one-third year-over-year, demonstrating the health and strength of the Greater Calgary Area.
Edmonton’s commercial real estate (CRE) investment market was remarkably stable during 2017, with total dollar volume down just 2.9% year-over-year. There was a game of musical chairs among some asset classes; office investment dominated the year while industrial investment faded. Retail stayed put.
The Mexico City Metropolitan Area Inventory for Class A and A+ office buildings closed the 4Q of 2017 with a total office inventory of 6.3 million square meters. This represents an increase of 10% equivalent to 607 thousand Sq.M.
At the close of the fourth quarter of 2017, the Metropolitan Area of Mexico City’s Industrial Market recorded an inventory of 9.5M Sq.M. of industrial ships class A, mainly in the submarkets of Cuautitlan (19%), Tultitlan (17%) and Tepotzotlan (13%).
At the end of 2017, Calgary’s overall retail market reflected the onset of the economic recovery and benefited from several corporate expansions.
Investors continued to demonstrate interest and confidence in the Edmonton market.
Vacancy in Calgary’s Downtown remained relatively steady over the third quarter of 2017, rising by 0.4% to 25%. Q3 proved quiet in comparison to the preceding 11 quarters, posting negative net absorption totaling Downtown Market Beltline Market 193,000 square feet (sf).
Investors continued to demonstrate confidence in the Calgary market through the third quarter of 2017.
The end of the third quarter brings healthy activity from both the sales and leasing market throughout the Calgary area.
AT THE MID-POINT OF 2017, THE EDMONTON MARKET POSTED A FOURTH CONSECUTIVE QUARTER OF RENEWED APPEAL TO COMMERCIAL REAL ESTATE (CRE) INVESTORS. AS A BONUS, 2017 IS WIDELY CONSIDERED THE YEAR ALBERTA WILL SEE ITS ECONOMY ENTER A RECOVERY STAGE. THE SENSE OF OPTIMISM THAT SET IN DURING THE LATTER PORTION OF 2016 CONTINUED AND WAS MANIFEST IN THE MORE THAN $1.08 BILLION BEING INVESTED IN COMMERCIAL PROPERTIES FROM JANUARY THROUGH JUNE.
DURING THE FIRST HALF OF 2017, RAYS OF LIGHT CONTINUED BREAKING THROUGH THE CLOUDS CAST BY A NEARLY THREE-YEAR LONG RECESSION. THOUGH THE ALBERTA ECONOMY GENERALLY CONTINUED MOVING AT A SLOWED PACE, A FEW KEY SECTORS EXPANDED AND SEVERAL LARGE FINANCIAL INSTITUTIONS MAINTAINED THEIR FORECASTS OF AN OVERALL RECOVERY THIS YEAR.
CALGARY’S SUBURBAN MARKETS EXPERIENCED AN INTERESTING SECOND QUARTER AS SEVERAL NEW OFFICE DEVELOPMENTS WERE DELIVERED.
VACANCY IN CALGARY’S DOWNTOWN REMAINED RELATIVELY STEADY AT MID-YEAR 2017, RISING BY 0.4% TO 24.6%.
Vacancy dropped to 3% following four consecutive quarters in the mid-3% range. This marks a return to Q1 2016 levels.
Investors continued to demonstrate confidence in the Calgary market through the first quarter of 2017.
At the end of the first trimester of 2017, the industrial market of the Metropolitan Area of Mexico City recorded an inventory of 8.8M Sq.M of industrial ships class A, mainly in the submarkets of Cuautitlan (32%) and Toluca (20%).
Absorption totaled 27,101 sq. ft. in the First Quarter of 2016, solid numbers for a market which had tens of thousands of square feet come on line due to the Deloitte relocation this spring. We continue to remain cautious with our expectations for properties just out of receivership and anticipate potential volatility as new availabilities are introduced to the Suburban West Shore Marketplace.
TCN Worldwide's State of the Market: Eastern Edition, 1st Quarter 2016 Prepared by Hugh F. Kelly, PhD, CRE, Consulting Economist to TCNIn this edition: –Overview of National Economic Context –Regional Conditions in the Eastern States –Commercial Property Investment Trends
TCN Worldwide's State of the Market: Eastern Edition, 4th Quarter 2015 Prepared by Hugh F. Kelly, PhD, CRE, Consulting Economist to TCNIn this edition: –Overview of National Economic Context –Regional Conditions in the Eastern States –Commercial Property Investment Trends
TCN Worldwide's State of the Market: Eastern Edition, 3rd Quarter 2015 Prepared by Hugh F. Kelly, PhD, CRE Consulting Economist to TCNIn this edition: –Overview of National Economic Context –Regional Conditions in the Eastern States –Commercial Property Investment Trends
"As we enter the second half of 2015 we see markets which are continuing to trend towards favorable levels. Buyers are beginning to respond to the Federal Reserve’s hint of an interest rate increase later this September. We see a pronounced increase in the acquisition market and anticipate this activity will continue going forward into 2016."
"Second quarter 2015 continues an ongoing positive trend ... our seventeenth straight quarter of positive absorption."
Research and analysis by Hugh Kelly
Second quarter 2021 closed with a direct vacancy rate of 5.11%, an overall vacancy rate of 5.55%, and an average asking direct rental rate reported at $7.09 psf. In June, the Michigan unemployment rate was recorded at 5.0%, a decrease of 16.2 percentage points compared to this time last year, while the U.S. unemployment rate was recorded at 5.9%, a decrease of 5.2 percentage points from one year ago. U.S. job openings surged to a record high as available positions escalated to 9.21M in May compared to April’s 9.19M. As the economy begins to rebound, social activity begins to grow, and more individuals become vaccinated U.S. employers are in high demand to fill a growing number of positions yet continue to face challenges. Many employers have begun offering incentives and increased wages to attract new employees and retain existing ones. Despite the 5% increase in the consumer price index over the past year, the largest increase since 2008, additional indicators and resources are pointing to an improving economy. Indicators include available job openings, an increase in travel, a spike in U.S. home construction that increased from 3.6% in May to 6.3% in June, and a growth in the manufacturing sector despite issues with the supply chain.
Second quarter 2021 closed with a direct vacancy rate of 19.90%, an overall vacancy rate of 21.46%, and an average asking direct rental rate reported at $18.52 psf. In June, the Michigan unemployment rate was recorded at 5.0%, a decrease of 16.2 percentage points compared to this time last year, while the U.S. unemployment rate was recorded at 5.9%, a decrease of 5.2 percentage points from one year ago. U.S. job openings surged to a record high as available positions escalated to 9.21M in May compared to April’s 9.19M. As the economy begins to rebound, social activity begins to grow, and more individuals become vaccinated U.S. employers are in high demand to fill a growing number of positions yet continue to face challenges. Many employers have begun offering incentives and increased wages to attract new employees and retain existing ones. Despite the 5% increase in the consumer price index over the past year, the largest increase since 2008, additional indicators and resources are pointing to an improving economy. Indicators include available job openings, an increase in travel, a spike in U.S. home construction that increased from 3.6% in May to 6.3% in June, and a growth in the manufacturing sector despite issues with the supply chain.
First quarter 2021 closed with a direct vacancy rate of 19.46%, an overall vacancy rate of 20.76%, and an average asking direct rental rate reported at $18.51 psf. In March, the Michigan unemployment rate was recorded at 5.1%, a decrease for the third straight month, yet still at an elevated rate compared to one year ago when recorded at 3.5%. While the U.S. unemployment rate was recorded at 6.0% in March, it continues to steadily decrease as the number of jobless claims dip as many job sectors continue to reopen. Optimism continues to grow as U.S. employers are expected to continue to add jobs as many states move towards easing business restrictions, creating confidence in paving a path toward strengthening the economic recovery in the coming months. Many other factors signal a strengthening economy including consumer spending, investing, and housing demand. Consumer spending increased at the fastest pace in 9-months and was recorded at 4.2% in March, while home prices in the U.S. increased by 11.9% in February, the fastest pace in close to 7- years as demand for housing continues to escalate. The Federal Reserve also announced they expect to keep the interest rate near zero with no rate hikes through 2023.
First quarter 2021 closed with a direct vacancy rate of 5.18%, an overall vacancy rate of 5.60%, and an average asking direct rental rate reported at $7.02 psf. In March, the Michigan unemployment rate was recorded at 5.1%, a decrease for the third straight month, yet still at an elevated rate compared to one year ago when recorded at 3.5%. While the U.S. unemployment rate was recorded at 6.0% in March, it continues to steadily decrease as the number of jobless claims dip as many job sectors continue to reopen. Optimism continues to grow as U.S. employers are expected to continue to add jobs as many states move towards easing business restrictions, creating confidence in paving a path toward strengthening the economic recovery in the coming months. Many other factors signal a strengthening economy including consumer spending, investing, and housing demand. Consumer spending increased at the fastest pace in nine months and was recorded at 4.2% in March, while U.S. home prices increased by 11.9% in February, the fastest pace in close to seven years as demand for housing continues to escalate. The Federal Reserve also announced they expect to keep the interest rate near zero with no rate hikes though 2023.
"The good news about 2020 is that the pandemic’s effect on the multifamily market doesn’t appear to be sustained, rather, more of a temporary pause."
2020 was a year for the ages. Election years are always uncertain, but this was the most contentious in recent history. Add to this a once in a century style global pandemic, a stock market crash, a recession, record job losses, civil unrest, and negative oil prices. It was a year that will be recalled for many decades to come. 2021 is welcomed with renewed optimism, some sense of clarity and stability, as well a light at the end of the Covid-19 pandemic in the form of a vaccine. In spite of all of the distractions, Texas continued to plod along, albeit at a slower pace than the previous year.
2020 was a year for the ages. Election years are always uncertain, but this was the most contentious in recent history. Add to this a once in a century style global pandemic, a stock market crash, a recession, record job losses, civil unrest, and negative oil prices. It was a year that will be recalled for many decades to come. 2021 is welcomed with renewed optimism, some sense of clarity and stability, as well a light at the end of the Covid-19 pandemic in the form of a vaccine. In spite of all of the distractions, Texas continued to plod along, albeit at a slower pace than the previous year.
"2021 will be the year of retail recovery, but it will be a very uneven, choppy recovery."
"2020 is a year that will long be remembered as one of significant upheaval and uncertainty and the Oklahoma City office market was certainly not immune to that."
According to the U.S. Census Bureau, retail sales during May 2020 were up 17.7% seasonally adjusted from the prior month but down 6.1% year-over-year. That follows a record-setting 14.7% drop in April 2020 (month-over-month).
The last 12 months have been marked by dramatic changes. As of this writing, these events have not seriously affected the Oklahoma City multi-tenant industrial market. Overall, multi-tenant industrial properties have continued the declining vacancy trend seen over the past two years. The bulkwarehouse sector is the exception this year.
During the first half of 2020 the market vacancy rate rose from 20.9% to 23.5% in the first half of 2020. The rise in vacancies has been market-wide with the Central Business District vacancy rate rising from 21.8% to 23.6% and the suburban submarkets rising from 20.8% to 23.4% vacant. Market-wide rental rates showed a slight dip from $19.53 per square foot to $19.45 per square foot. The market experienced negative absorption of nearly 536,000 square feet which was market-wide in nature rather than limited to one or two submarkets. The CBD experienced negative absorption of 146,000 SF and the suburban submarkets totaled nearly 390,000 SF of negative absorption.
Three quarters of the way through the year, 2019 has been better than expected. DFW growth has continued to increase. DFW still struggles to find labor, and that is the biggest strain on the economy at the present time. There is a true war for talent, and we continue to monitor this closely. Trade tariffs and slowed oil & gas activity continue to be a concern; however, there is enormous interest from coastal markets on the relocation & investment fronts from (New York, Boston, Los Angeles, San Francisco). The economy continues to grow, and we feel the fundamentals for Dallas-Fort Worth are positive and the 4th quarter of 2019 will be exceptional.
Three quarters of the way through the year, 2019 has been better than expected. DFW growth has continued to increase. DFW still struggles to find labor, and that is the biggest strain on the economy at the present time. There is a true war for talent, and we continue to monitor this closely. Trade tariffs and slowed oil & gas activity continue to be a concern; however, there is enormous interest from coastal markets on the relocation front and the investment from (New York, Boston, Los Angeles, San Francisco), the economy continues to grow, and we feel the fundamentals for Dallas-Fort Worth continue to be positive and the 4th quarter of 2019 is expected to be exceptional.
The first half of 2019 showed little change in the Oklahoma City office market, but what change occurred was fairly positive. Vacancies fell from 20.1% to 19.3% and absorption of space totaled 128,000 square feet.
Oklahoma City real estate is known for its relative stability and slow but steady growth. We typically don’t see the cyclical volatility nor the overexuberance of other markets. The numbers for the first half of the year reflect this even as retail nationally and locally is undergoing transformational change.
Current multi-tenant industrial vacancy for the Oklahoma City metro area now stands at 16.96%, down from 20.31% in mid-year 2018. These swings seem to be the new normal – multi-year strong absorption and rent growth periods followed by multi-year double-digit vacancy and relative quiescence (a kinder term to use around your developer friends than “stagnation”), culminating in eight to ten-year cycles overall.
The second quarter of 2019 continues to show that the market favors the landlord. Vacancy rates held steady in Q2, while asking rents rose from $7.09 in the first quarter, to $7.17 in Q2.
Overall market occupancy equaled 92 percent at year-end 2018, unchanged from a year ago. This confirms that there has been little overall movement in the aggregate market but belies all the activity behind the numbers. The underlying fact is that retail continues to grow, both nationally and locally. We added 650,000 square feet of space in centers over 25,000 square feet this past year, maintained occupancy, and, for the most part, rents. Much of the pain of the last few years is over – store closings have declined, downsizing is still taking place but at a reasonable rate, and retail layoffs have leveled off.
The first half of 2018 brought expected results for the Oklahoma City Central Business District with increased vacancy due to the addition of the BOK Park Plaza Building to available inventory and negative absorption of 84,000 square feet. However, there are continued signs of improvement in the suburbs as 157,000 square feet was absorbed in those submarkets. The net absorption for the entire market was a positive 73,000 square feet; the first positive absorption total in the past seven semi-annual reports.
TCN Worldwide's State of the Market: Western Edition, 2nd Quarter 2017 Prepared by Hugh F. Kelly, PhD, CRE, Consulting Economist to TCN Worldwide. In this edition: –National and Macroeconomic Overview –Regional Economic Conditions –Commercial Property Investment Trends
TCN Worldwide's State of the Market: Western Edition, 1st Quarter 2017 Prepared by Hugh F. Kelly, PhD, CRE, Consulting Economist to TCN Worldwide In this edition: –National and Macroeconomic Overview –Regional Economic Conditions –Commercial Property Investment Trends
The Denver retail vacancy rate decreased in the fourth quarter, ending the year at 4.6%. Overall, the retail market has seen a decrease in vacancy rate, with the vacancy rate starting at 4.9% in Q1 2016, to 4.8% in the end of Q2 2016, remaining 4.8% at the end of Q3 2016, down to 4.6% in Q4 2016.
The Denver industrial vacancy rate slightly increased in the fourth quarter, ending the year at 4.8%. Specifically, both industrial-flex projects and warehouse projects experienced an increase in vacancy over the last quarter but slightly fluctuated throughout all four quarters.
The Denver office market ended the year with a vacancy rate of 9.8%. The market continued its upward climb in vacancy for the second consecutive quarter after six quarters that consistently posted a decrease.
TCN Worldwide's State of the Market: Western Edition, 4th Quarter 2016 Prepared by Hugh F. Kelly, PhD, CRE, Consulting Economist to TCN Worldwide In this edition: –National and Macroeconomic Overview –Regional Conditions in the Central States –Commercial Property Investment Trends
The Denver office market experience an upward tick in vacancy for the first time in 6 quarters during the third quarter of 2016. CoStar reported the third quarter vacancy rate at 9.6%. It was also reported that rental rates decreased slightly to $24.94 in Q3 2016 from a reported $25.11 the previous quarter. Net absorption for the overall Denver office market was a negative (29,698) comparing to a positive 754,222 square feet at the end of Q2, and a positive 722,380 square feet in Q1 2016.
The overall Denver industrial vacancy rate ended the third quarter at 4.5%, remaining exactly the same as the previous quarter. More specifically, both industrial-flex projects and warehouse projects experienced a slight increase in vacancy over the last quarter. Vacant sublease space increased dramatically, to 987,082 square feet from 618,165 square feet the previous quarter. Currently there are 4,559,050 square feet of industrial buildings under construction, having had a total of 8 buildings delivered to the market totaling 616,142 square feet during Q3 2016.
The Denver retail market did not experience much change in the third quarter compared to the previous quarter. There was positive absorption of 414,201 square feet from a positive 528,879 square feet in the second quarter 2016. Vacancy rates remained steady at 4.7% quarter-over-quarter.
TCN Worldwide's State of the Market: Western Edition, 3rd Quarter 2016 Prepared by Hugh F. Kelly, PhD, CRE, Consulting Economist to TCN Worldwide In this edition: –National and Macroeconomic Overview –Regional Conditions in the Western States –Commercial Property Investment Trends
TCN Worldwide's State of the Market: Western Edition, 2nd Quarter 2016 Prepared by Hugh F. Kelly, PhD, CRE, Consulting Economist to TCN WorldwideIn this edition: –National and Macroeconomic Overview –Regional Conditions in the Western States –Commercial Property Investment Trends
As we enter the fifth year of the latest "tech boom," there are some pretty compelling signs that the "party is almost over."
TCN Worldwide's State of the Market: Western Edition, 1st Quarter 2016 Prepared by Hugh F. Kelly, PhD, CRE, Consulting Economist to TCNIn this edition: –Overview of National Economic Context –Regional Conditions in the Western States –Commercial Property Investment Trends
Stark & Associates Retail Market Newsletter for the Northern Nevada Market. Local experts are bullish on Nevada...
TCN Worldwide's State of the Market: Western Edition, 3rd Quarter 2015 Prepared by Hugh F. Kelly, PhD, CRE Consulting Economist to TCNIn this edition: –Overview of National Economic Context –Regional Conditions in the Western States –Commercial Property Investment Trends
TCN Worldwide's State of the Market: Western Edition, 3rd Quarter 2015 Prepared by Hugh F. Kelly, PhD, CRE Consulting Economist to TCNIn this edition: –Overview of National Economic Context –Regional Conditions in the Western States –Commercial Property Investment Trends
The Scottsdale Office market ended the second quarter 2015 with a vacancy rate of 15.8%, which was slightly lower over the previous quarter. Net absorption totaled positive 42,390 square feet and rental rates ended the second quarter at $23.29, an increase over the previous quarter. No buildings were delivered, but 239,189 square feet are still under construction at the end of the quarter.
The Scottsdale retail market experienced a slight improvement in market conditions in the second quarter 2015. The vacancy rate went from 7.3% in the previous quarter to 7.5% in the current quarter. Net absorption was negative (38,078) square feet, thus creating an increase in vacant space. Quoted rental rates increased from first quarter levels, ending the second quarter at $20.24 per square foot per year. No buildings were delivered in the second quarter but 172,689 square feet are still under construction at the end of the quarter.
The Scottsdale Industrial (Northeast Ind) submarket ended the second quarter 2015 with a vacancy rate of 9.5%. The vacancy rate increased since the previous quarter, with net absorption totaling a negative 35,131 square feet in the second quarter. Vacant sublease space also increased in the quarter and rental rates ended at $11.32, an increase over the previous quarter.
A Complete Analysis of Denver Metro & Surrounding MarketsNumbers - Locations Vacancies - Rates