SALT LAKE CITY, UT--(Marketwired - May 4, 2015) - The commercial real estate market in Salt Lake City started the year off with very strong figures according to the new Marketbeat Snapshot reports from Cushman & Wakefield | Commerce (www.comre.com).
"The celebrated economic conditions Utah is currently experiencing are reflected in the strength of the commercial real estate market," said Michael Lawson, President of Cushman & Wakefield | Commerce. "Technology firms, which have been bolstered by an uptake in VC funding, are fueling the growth in the office sector. The retail market is showing strong absorption rates and industrial leasing activity was up by 8.2 percent over last year. Furthermore, the total commercial real estate investment sales that have come through are second only to last year's historic Q1 numbers."
The following are report highlights from the Cushman & Wakefield | Commerce reports, which can be accessed (along with historical reports) at http://www.comre.com/research.
Office Snapshot
The flourishing technology sector in Utah, which has seen an influx of VC dollars, has pushed up employment numbers in several Utah metropolitan areas. Average asking lease rates are up 2.3 percent year-over-year, but the overall vacancy rate declined by 1.5 percentage points (pps) year-over-year and 0.3 pps since year-end 2014. As the market tightens for class A space, upward pressure on rental rates is expected while lease incentives continue to dry up.
Industrial Snapshot
Activity in the industrial market through Q1 remained strong as leasing activity increased by 8.2 percent over the same period in 2014 and the overall vacancy rate is down by 0.8 pps on a year-over-year basis. Leasing activity is expected to increase in the second quarter as several large transactions are completed; however small and mid-size tenants will continue to struggle to find quality space that meets their needs as new product is centered on larger tenancy.
Investment Snapshot
The investment market saw the highest number of 1st quarter transactions since 2006. Demand for investment product remains high and will continue to outpace supply in the market. Another stellar year is anticipated in the investment segment.
Retail Snapshot
The retail market started the year off strong with 162,003 square feet of space absorbed during Q1 2015. This strong absorption pushed the overall vacancy rate down by 0.5 pps on a year-over-year basis to just 6.6 percent and the average asking lease rates increased by 1.7 percent to $19.02 per square foot NNN.
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About Cushman & Wakefield | Commerce
Cushman & Wakefield | Commerce, headquartered in Salt Lake City, Utah is an independently owned and operated member of the Cushman & Wakefield Alliance with offices throughout Utah, Nevada, Washington and Idaho. The firm partners with its sister company Cushman & Wakefield | NorthMarq to provide innovative commercial real estate solutions to occupier and investor clients, offering transaction services, capital markets services, occupier and investor services, and real estate advisory. Together the firms manage more than 52 million sq. ft. of retail, industrial, and office assets, have annual revenues of more than $100 million, and employ more than 750 professionals. Learn more at www.comre.com; www.cushwakenm.com. C&W | Commerce and C&W | NorthMarq are part of the Cushman & Wakefield platform, which is the world's largest privately-held commercial real estate services firm with 250 offices in 60 countries globally. www.cushmanwakefield.com.
About Cushman & Wakefield
Cushman & Wakefield advises and represents clients on all aspects of property occupancy and investment. Founded in 1917, it has 259 offices in 60 countries, employing more than 16,000 professionals. It offers a complete range of services to its occupier and investor clients for all property types, including leasing, sales and acquisitions, equity, debt and structured finance, corporate finance and investment banking, appraisal, consulting, corporate services, and property, facilities, project and risk management. To learn more, click HERE.
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