Posted on July 21, 2014 by info4karnesco - Chapel Hill, Charlotte, Commercial Property Exchange, Construction Update, Development, Durham, Greensboro/Winston-Salem/High Point, KARNES Perspective, KARNES Tri-City Report, Raleigh, Retail, SiteIndex, Triad CIE, Triangle, Triangle CPE, Western NC, WNC CPE
A combined total of 144.8 million square feet of retail space was located within the Tri-City area at the end of 2013. With a retail inventory totaling approximately 60.7 million square feet, the Charlotte market was the largest of the three North Carolina retail markets, accounting for 42% of the retail inventory. The Triangle market ranked second with 46 million square feet of retail space, while the Triad maintained 38 million square feet of retail space. After declining to a historical low of 541,782 square feet in 2002, retail construction increased to nearly one million square feet in the Tri-City markets during 2013. New retail supply during 2013 was most pronounced in the Triangle region, where 693,982 square feet of new space was delivered. The Charlotte region ranked second with 231,680 square feet of new retail space completed during 2013, while the Triad region reported 38,000 square feet of new retail during 2013. Only the Charlotte region reported a continued decline in new construction from the level reported in 2012. While retail construction in the Tri-City area increased during 2013, the level of new supply remained well below the 2.6 million square feet averaged annually between 2008 and 2011.
The relatively low supply-side pressures from new construction allowed for vacancy rates to decrease in all of the Tri-City markets during 2013. At 8.0%, the Charlotte retail vacancy rate decreased 0.6% of a point during 2013 as net absorption totaling 494,986 square feet outpaced the 231,680 square feet of new supply. Despite the decrease, the Charlotte vacancy rate remained above the 6.9% reported in 2008. The Triangle retail vacancy rate decreased 0.4% of a point during 2013 as net demand totaling 849,391 square feet outpaced 693,982 square feet of new supply. The Triangle’s 2013 vacancy rate of 6.6% was the lowest of the Tri-City markets, but remained 0.1% of a point higher than the 6.5% reported in 2008. New retail supply totaling 38,000 square feet in the Triad market was outpaced by net demand totaling 386,123 square feet during 2013. As a result, the Triad retail vacancy rate decreased 0.9% of a point to 10.1% from the 11.0% reported at the end of 2012. Despite the decrease, the rate remained 0.5% of a point higher than the 9.6% reported at the end of 2010.
Posted on July 21, 2014 by info4karnesco - Charlotte, Commercial Property Exchange, Construction Update, Greensboro/Winston-Salem/High Point, KARNES Perspective, KARNES Tri-City Report, Office, Raleigh, SiteIndex, Triad CIE, Triangle, Triangle CPE, Western NC, WNC CPE
A combined total of 117 million square feet of office space is located within the Tri-City area. Totaling nearly 50 million square feet at the end of 2013, the Charlotte market is the largest of the three North Carolina office markets. The Triangle market ranked second with 41.4 million square feet of office space, while the Triad maintained 25.7 million square feet of office space. After reporting a total of 1.48 million square feet of new office construction in the Charlotte, Triangle, and Triad regions during 2012, new supply came to a halt during 2013 and marked the first time in over 25 years that no new office space was completed in the combined Tri-City region.
The decrease in supply-side pressure allowed for gains to be reported in each of the Tri-City markets. The Charlotte market reported the greatest gains during 2013 as net absorption (demand) totaling 1.3 million square feet resulted in a 2.5%-point decrease in the office vacancy rate. The year-end 2013 rate of 14.8% in Charlotte was the lowest vacancy rate among the three markets, with the Triangle and Triad both reporting a rate of 15.0%. The year-end 2013 Triangle vacancy rate was 0.6% of a point lower than the year-end 2012 rate as net absorption totaled 204,615 square feet. The Triad region reported a 0.2% of a point decrease in vacancy during 2013 as net absorption totaled 162,219 square feet.
With net absorption totaling 1.3 million square feet, the Charlotte region reported the highest level of net demand during 2013. The Triangle region ranked second in terms of office demand during 2013 with net absorption totaling 204,615 square feet. The Triad market reported 162,219 square feet of net demand during 2013. Four office tenants occupied over 100,000 square feet in the Tri-City markets during 2013, with the largest tenant occupancy reported at Ballantyne – Gragg Building, where MetLife took 284,212 square feet. MetLife also accounted for the fourth largest gain as the company took 104,747 square feet of space at Ballantyne Three. Ballantyne Corporate Park also accounted for the largest contraction during 2013 in the Tri-City markets as AXA Equitable Life Insurance relocated from 152,000 square feet at Ballantyne – Rushmore One to 141,647 square feet at Innovation Park Building 202.
With over 9,336 apartment units under construction during September 2013 in the Raleigh-Durham market, Novare Group and Beacon Partners have broken ground on Skyhouse Raleigh, a planned 23-story apartment building, in Downtown Raleigh. The project is on a fast track completion deadline and is slated to deliver 320-units within 12-months.
The Triangle apartment market continues to attract investors, with current construction levels the highest reported in any period since 1997. The Triangle area market reports, which are prepared by KARNES and made available online at www.aptxchange.com, cover market conditions including construction, vacancy, absorption, and rental trends. Below are a few highlights from the most recent report.
- A total of 105,477 units where surveyed during the Fall 2013 period.
- Over the six-month period ending in September 2013, a total of 2,866 units were completed
- A total of 9,336 units were under construction in the Triangle as of September 2013.
- The regional vacancy rate climbed 0.4% of a point to 5.9% from the reported March 2013 vacancy of 5.5%
- At $898, the Fall 2013 average weighted monthly rent for all apartment units in the Triangle was up $19 from the average reported in March 2013.
To find out more about the multifamily market in the Triangle Region, please visit us at www.aptxchange.com or by calling us at 800.879.7172.
Posted on April 18, 2013 by info4karnesco - Charlotte, Commercial Property Exchange, Construction Update, Greensboro/Winston-Salem/High Point, In the News, Industrial, KARNES Perspective, Office, Raleigh, Retail, Triangle
Andrew Jenkins, managing partner of KARNES, was a speaker today at the Appraisal Institute 2013 Real Estate Valuation Conference, which took place in Charlotte. The panel event featured various industry experts including Mark Vitner (Senior Economist, Wells Fargo), Roger Cobb ( Broker, Selwyn Property Group), Jon Morris (Broker, Beacon Partners), and Henry Breaux (Broker, The Providence Group).
Mr. Jenkins’s discussion provided an insight into commercial market data, analysis and trends, from the largest regions across North Carolina.
Click here to download a PDF version of the presentation and read on for a transcript of the presentation’s key points:
Tri-City Market Overview
April 18, 2013
Presented by Andrew Jenkins, Managing Partner, KARNES
Tri-City Market Overview Introduction
- KARNES began producing the Tri-City Commercial Real Estate Market Report in 2012 in an effort to bring a standardized analysis method across the state.
- The intention of the report is to provide an annual review, at a high level, of the commercial markets in the three major NC regions.
Brian Reece, managing partner of KARNES, will be a speaker at the Downtown Raleigh Alliance (DRA) State of Downtown Raleigh 2013. At the event, attendees will hear about comprehensive market analysis of Raleigh’s Central Business District (CBD) for the purpose of informing and exploring new partnerships with the investor and real estate community.
Mr. Reece’s discussion will provide a multi-family update, including occupancy trends and the current boom in apartment development activity in downtown
According to the Downtown Raleigh Alliance website, this is the premier event for developers, brokers, and economic developers whose clients would benefit from learning more about Raleigh’s CBD.
The event will be Wednesday, April 17th from 8-10am at the Raleigh Marriott City Center, located at 500 Fayetteville St.
KARNES was pleased to be in attendance for the Charlotte Business Journal’s Commercial Real Estate Quarterly (CREQ) Live event this morning, which featured Johnny Harris, President and Chief Executive Officer of Lincoln Harris. Mr. Harris provided the audience with a fireside chat, conducted by the Charlotte Business Journal’s Will Boye, covering a range of topics including his involvement in the development of commercial real estate in Ballantyne, SouthPark, and Uptown Charlotte.
The keynote by Mr. Harris was preceded by a lively roundtable discussion involving the winners of the 2013 CRCBR® Deal Makers Awards, an annual awards program officially audited by KARNES. Award winners and panelist included Jensie Teague of Selwyn Property Group, Inc., Rob Pressley of Coldwell Banker Commercial-MECA, Christopher Skibinski of The Skibinski Company, Brian Brtalik of Cusham & Wakefield | Thalhimer, and Phil Brosseau, Jr. of CBRE.
The CREQ Live event is the Charlotte Business Journal’s semi-annual event that brings the Charlotte Business Journal’s Commercial Real Estate Quarterly (CREQ) publication to life. For over 20 years KARNES has been the source for the Charlotte Business Journal’s CREQ exclusive commercial real estate content and looks forward to many more years working together with the Charlotte Business Journal.
Please be sure to update your commercial real estate listings at SiteIndexCharlotte.com to be included in the next CREQ publication, which will be available on May 17th, 2013.
2013 CCIM Market Forecasts
The 2013 CCIM Market Forecasts were a great success and it was our pleasure to get a chance to see familiar faces along with new ones during the past two weeks at the 2013 CCIM Market Forecasts in Greensboro, Charlotte and Cary.
Each of the forecasts focused on the opportunities upcoming in the North Carolina market with an emphasis on how education and workforce development will continue to spur growth in the state.
In addition to a positive outlook for 2013, KARNES was pleased to report that each of the commercial real estate sectors reported positive growth during 2012 in our Tri-City North Carolina Commercial Real Estate Market Report. If you were unable to attend one of the forecasts and would like a copy of this report please look for us at one of the many upcoming networking event during 2013.
Below is an executive summary of our report’s key findings:
A combined total of 143.6 million square feet of retail space is located within the Tri-City area. With a retail inventory totaling approximately 60.4 million square feet at the end of 2012, the Charlotte market is the largest of the three North Carolina retail markets, accounting for 42% of the retail inventory. The Triangle market ranked second with 45.4 million square feet of retail space, while the Triad maintained 37.8 million square feet of retail space. Retail construction continued to decline during 2012 as a combined total of 541,782 square feet of new retail space was completed in the Charlotte, Triangle, and Triad markets. This was the lowest level reported since Karnes began tracking the markets. New retail supply during 2012 was most pronounced in the Charlotte region, where 343,100 square feet of new space was delivered. The Triangle region ranked second with 166,138 square feet of new retail space completed during 2012, while the Triad region reported 32,544 square feet of new retail during 2012.
The reduced supply-side pressures allowed for vacancy rates to decrease in all of the Tri-City markets during 2012. At 8.6%, the Charlotte retail vacancy rate decreased 0.4% of a point during 2012 as net absorption totaling 371,754 square feet outpaced the 343,100 square feet of new supply. Despite the decrease, the Charlotte vacancy rate remained above the 8.4% reported in 2009 and the five-year low of 6.9% reported in 2008. The Triangle retail vacancy rate decreased 0.5% of a point during 2012 as net demand totaling 376,483 square feet outpaced 166,138 square feet of new supply. The Triangle’s 2012 vacancy rate of 7.0% was the lowest of the Tri-City markets, but remained 0.5% of a point higher than the 6.5% reported in 2008. New retail supply totaling 32,544 square feet in the Triad market was outpaced by net demand totaling 234,511 square feet during 2012. As a result, the Triad retail vacancy rate decreased 0.5% of a point to 11.0% from the 11.5% reported at the end of 2011. Despite the decrease, the rate remains 1.4% points higher than the 9.6% reported at the end of 2008.
Join us on March 12th in Charlotte and March 13th in Cary, as KARNES and local commercial real estate professionals attend the 2013 CCIM Market Forecasts. KARNES is pleased to be a Tri-City Bronze Sponsor of these events and will be providing copies of our annual Tri-City North Carolina Commercial Real Estate Market Report at each of these events as well. Be sure to attend in order to get your copy of this report, which provides a year-in-review of commercial markets in the Charlotte, Greensboro/Winston-Salem/High Point, and Raleigh-Durham regions.
The Charlotte event will be moderated by Jim Rogers, Flagship Capital and Drew Showfety, NC-CCIM President, will be held at the Carmel Country Club. The Triangle event will be moderated by Thomas “Skip” Hill, Highwoods Properties and Drew Showfety, NC-CCIM President, will be held at the Embassy Suites in Cary. Registration and networking will begin at 11:15am, and the program luncheon will begin at 11:45am for both events.
The Woodward Building (pictured above) at Ballantyne is one of two speculative buildings delivered at Ballantyne Corporate Park during 2012. Image provided by The Bissell Companies
Governor Pat McCrory announced today that MetLife, Inc., intends to create 2,600 jobs in Charlotte and Cary, North Carolina by the end of 2015. While the final location of the Cary office has not been decided, it appears that MetLife will lease the entirety of the 276,120-square-foot Gragg Building at the Ballantyne Corporate Center. The Gragg Building, which was completed at the end of 2012, was one of two buildings developed on speculation at the Charlotte office park during 2012. MetLife’s occupancy of this 276,120-square-foot building would have a dramatic impact on the vacancy rate in the NC-51/Southeast submarket in Charlotte. The vacancy rate in the NC-51/Southeast submarket was 20.2% at the end of 2012 and would decrease 4% points when MetLife occupies the space.