Local commercial real estate up 52%, good outlook for 2022
The Tri-Cities commercial real estate market kicked off the new year with a 52% increase in transactions as last year’s growing demand extended into the new year.
Cassie Petzoldt said the market’s pulse and type of deals look a lot like how it wrapped up last year. Petzoldt is the chair of the Northeast Tennessee Association of Realtors (NETAR) Commercial Committee. “So far, the Office and Retail-Commercial sector are out-front of leases and sales.” She added that January’s active inventory and new listings are down from last year. That’s more of a reaction to increased transactions putting a strain on existing inventory than a slowing of the market’s pace, she added.
At month’s end, 41 leases and sales had been completed in the Tri-Cities’ two metro areas. There were 27 transactions during the first month of last year. That starting point was a low for 2021. Transactions picked up every month and finished the year, totaling 571, an all-time high and 115.5% increase from the 2020 total.
There were eight transactions in both the Office and Retail-Commercial sections last month. That’s consistent with last year.
Multi-Family saw three deals completed. That total isn’t totally representative of the region’s overall multi-family market. It includes what happened with properties that were listed on the two local commercial market listing services. Some of the larger local multi-family complexes are owned by investment groups and investors who live outside the area. They tend to patronize the national commercial listing services. At the same time, much of the current market activity has centered on new construction in the wake of increased demand.
Active commercial inventory was 32% lower than last year. Listing totaled 684 at month’s end, up from 499 in December.
Last month, there were 75 new listings, up from 59 in December and down from 80 last year.
Office, Retail-Commercial, and Vacant Land sectors dominated last month’s active listings.
The outlook for this year is positive despite some uncertainty over potential COVID impacts and other risks. The CBRE outlook says a growing economy will fuel demand for space and increased investments across all property types.
The current local recovery trends are especially good for downtowns.
NETAR is the voice for real estate in Northeast Tennessee. It is the largest trade association in the Northeast Tennessee, Southwest Virginia region, representing over 1,800+ members and 100+ business partners involved in all aspects of the residential and commercial real estate industries. Weekly market reports and information for both consumers and members are available on the NETAR website at https://netar.us