The effects of the coronavirus outbreak on the tri-county area commercial market remain unclear. Prior to the coronavirus outbreak, the tri-county area had strong economic momentum, and the current report largely reflects the environment before the pandemic. It is too early to provide a quantitative assessment or forecast of the ultimate market impact of COVID-19. As with previous reports, our analysis focuses on the market activity reflected in current quarterly statistics. The overnight halt to the tourism industry will likely have repercussions for the local economy. In a year of evident political and economic uncertainty, we expect to see additional tempering in metrics — including asking rent growth and construction starts — as companies look for additional signals of where their businesses are headed this year.
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 Denver retail market has been a cyclical winner. Trade area demographics are supporting retail sales, with the metro's superior growth in population, employment, and income increasing buying power.
The Denver office market is in the midst of a moderate rebound. Rent growth slowed sharply throughout 2015 and 2016 as the market felt the full brunt of the collapse in oil prices, and rents at 4 & 5 Star properties briefly turned negative.
There’s never been a better time in the last 10 years to be a Montreal tenant. With new space coming on the market and large tenants such as Deloitte and Rio Tinto Alcan moving into new premises, now is the time to either trade up to better space or get equivalent to your current space for less.
AS WAS LARGELY EXPECTED, THE EFFECTS OF LOW PRICED OIL, COMBINED WITH A DRAMATICALLY CHANGED POLITICAL LANDSCAPE IN ALBERTA, affected investor sentiment and caused the investment market in Calgary to quiet significantly in 2015. In comparison to 2014 when $2.66 billion transacted across the Office, Retail, Industrial, Multi-Residential and ICI/Residential Land asset classes, approximately $1.5 billion was invested during 2015.
The Greater Calgary industrial market saw dramatic changes in 2015, with vacancy rising 53% year-over-year from 4.30% at the end of 2014 to 6.57% at the end of 2015. This marks a +15 year peak for Calgary’s industrial vacancy rate, which was previously set in Q4 2009 at 6.38%. Vacant space at the beginning of 2015 was 5,705,105 square feet, which rose to 9,079,126 square feet by the end of the year, an increase of almost 3.4 million square feet.
CALGARY’S RETAIL MARKET REMAINED RESILIENT DURING 2015, despite the drop in discretionary spending due to deteriorating economic conditions. The major impact on vacancy stemmed largely from successive retail chain store closures with Big Box space, which had been essentially zero for years, suddenly coming to market as Target Canada exited after two years of sustained losses and Best Buy began a rebranding campaign that included closing down its sister brand Future Shop. The country-wide closures included three in Calgary. By mid-year, Canadian Tire and Lowes had taken advantage of Target’s departure, purchasing all but one Target lease in Calgary but with four Big Box stores (the former Target store in Forest Lawn plus the former Futures Shop stores in Coventry Hills, Deerfoot Meadows and Sunridge) sitting vacant, Calgary’s overall retail vacancy increased year-over-year to 2.7% from 2.3% at the close of 2014.
AFTER A QUARTER-PERCENT DECREASE IN VACANCY DURING THE THIRD QUARTER, THE BELTLINE EXPERIENCED A 2.5% INCREASE IN VACANCY TO CLOSE THE YEAR. Negative absorption of 174,834 sf has driven the vacancy rate up to 17.33%.
The LBJ Corridor is one of the last remaining safe havens for companies that are seeking rent relief. With submarkets like Central Expressway and the Lower Tollway experiencing 10-12% vacancy rates, the East LBJ Corridor has a vacancy rate of just below 25%. We expect this to change drastically in 2017 with companies fleeing surrounding submarkets for the best valued office space in the entire DFW-Metroplex.
At the end of the third quarter of 2016, the flex market averaged a $8.87 psf triple-net rental rate, which is a significant increase from the third quarter average rental rate in 2015 of $8.07 psf triple-net. The vacancy rate for the second quarter of 2016 sits at 7.0%.
TCN Worldwide's State of the Market: Central 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 Central States –Commercial Property Investment Trends
Bradford Allen is pleased to share with you our 2016 third quarter market report.This quarter in the downtown market: • Absorption for the quarter reached 806,000 square feet • Rental rates dropped a nominal $.09 to $36.14 • Vacancy dropped to 11.5% • Two companies, Duracell and Wilson Sporting Goods, announced that they will be moving their offices to downtown Chicago
To no one’s surprise the first half of 2016 was a rough period for the Oklahoma City office market. The market’s vacancy rate increased from 12.3% to 14.8% and the market suffered negative absorption of 179,000 square feet. The Mid-Year 2016 report is yet another lagging economic indicator of where the state’s economy and particularly the state of the petroleum industry currently stands.