Although urban office markets continue to be popular with Millennials, movement to creative corporate office campuses in the suburbs is a growing trend. A recent report from commercial real estate services firm CBRE looked at vacancy rates and rental rate increases in a number of revitalized suburbs. A lack of new supply has driven rents up in the majority of these markets, while others are benefiting from outsized demand due to a concentration of specific industries, such as technology and bioscience. Below are the ten suburban office markets with the highest rent increases, according to the report:
The hotel industry could be facing an uphill battle in 2017 as new supply may erode pricing power and hinder performance. Hoteliers are already seeing performance dip as supply meets and surpasses demand. In a Hotel News Now roundtable, hotel executives and market analysts provide perspective on supply growth and how it will affect the hotel industry going forward. Jan Freitag, SVP of lodging insights at STR (Hotel News Now’s parent company), says new supply will negatively impact occupancies, now more than ever since demand growth will slow. While it remains to be seen how hoteliers react to the new competition in their markets, Feitag expects continued pressure on pricing and limited (average daily rate) increases going forward. Some markets (such as New York City and Miami), however, are already observing pricing weakness and ADR declines.
Some South Carolina House members are taking a comprehensive review of the state's tax laws, and are considering phasing out sales tax exemptions, reducing the top state income tax rate, and making property tax changes. Most on the 14 members of the panel meeting Tuesday agreed changes need to be made. The 2017 session of the General Assembly begins in January.
The Urban Land Institute and PwC recently released Emerging Trends in Real Estate 2017, an in-depth outlook report that reflects the views of more than 2,000 professionals in real estate development and investment who completed surveys, conducted interviews, or participated in focus groups as part of the research process. The reports includes a "Markets to Watch" section, that takes an expanded look at all 78 markets included in this year’s survey.
Survey respondents shuffled the markets a little for 2017. Austin, which has been a fixture in the top ten for the past few years, is getting its turn at the top. Austin's market has benefited from a diverse economy that was affected in a minimal way by the global financial crisis, a growing population base made up of an educated labor force, and the undeniable “hip” factor that makes Austin attractive to the millennial dominated workforce.
As Charleston continues to see impressive growth, demand for space in all commercial real estate sectors is outpacing supply. Rental prices will continue to escalate as commercial real estate in the Charleston region tightens amid dropping vacancy rates was the key takeaway from the 13th Annual Commercial Real Estate Market Forecast for the Lowcountry. While apartment demand will continue to accelerate but likely peaked in 2015, the industrial sector is expected to grow and expand at a faster pace than other sectors such as retail, office and multifamily.
Once again, New Jersey and Illinois ranked as the two worst states in the country when it comes to property taxes, according to a new survey from personal finance website WalletHub. In order to identify the states with the highest and lowest property taxes, WalletHub’s analysts compared the 50 states and the District of Columbia using U.S. Census Bureau data to determine real-estate property tax rates. While property taxes vary from county to county across the state, WalletHub divided the “median real-estate tax payment” by the “median home price” in each state to determine the property tax rate.
A pair of “game-changing investments," Volvo Cars North America and Mercedes-Benz Vans, is fueling Charleston's industrial sector and has the the potential to grow automotive manufacturing in the region and throughout South Carolina, according to a report by Colliers International. The region's industrial market is already seeing declining vacancy rates, and a slew of new construction taking place or planned will help keep up with the high demand. Mercedes-Benz and Volvo will be building manufacturing sites that, combined will result in $1 billion worth of investment and at least 5,300 jobs to start. The plants will also bring a flock of automotive suppliers that tend to locate near the main manufacturing site to reduce transportation costs. Because Charleston's industrial market is already tight, a spur in construction activity is expected in both speculative and build-to-suit construction.
South Carolina is in the middle of a manufacturing renaissance, posting back-to-back record years of manufacturing investment totaling $10 billion in 2013 and 2014 and an outlook just as promising for 2015. The Midlands region has benefitted from this investment and is poised to take off in 2015, as the market has the most to offer in the way of product for new and expanding companies. Because the upstate and low country markets have such limited viable manufacturing space, the Midlands region will actually benefit from vacancy in 2015, offering a variety of high-quality, move-in ready industrial product.
For the second year in a row, Georgia took the top spot in Site Selection magazine's Top US Business Climates: 2014. The magazine releases its annual rankings each November. The Peach State had been a strong performer in this contest for several years, rising in the ranking steadily thanks to its Quick Start workforce training program, logistics infrastructure and economic development leadership, among other factors, according to Site Selection. The magazine's ranking methodology is as follows: 50 percent of the overall Business Climate Ranking is based on a survey of corporate site selectors who are asked to rank the states based on their recent experience of locating businesses in them. The other 50 percent is based on an index of seven criteria: performance in Site Selection's annual Competitiveness ranking; total New Plant Database-compliant facilities in 2013; total new facilities in 2013 per capita; total 2014 new projects year to date; total 2014 projects year to date per capita; state tax burdens on mature firms and new firms according to the Tax Foundation and KPMG Location Matters analysis.