The regional commercial real estate market in November continued its recovery with a 44.1% increase over last year’s transaction performance. So far this year, all but one sector have outperformed the market in the first 11 months of 2020 and 2019.
“So far this year, the market has seen 512 transactions, 191 more than last year,” according to Cassie Petzoldt, chair of the trade committee for the Northeastern Tennessee Association of Realtors (NETAR). “Since the end of the summer, the retail sectors – both retail and shopping centers – have seen leases and sales strengthen. It hasn’t outpaced activity in the office sector, but combined they account for 41% of all deals so far this year. »
Office transactions were stable throughout the year. The performance of the sector goes against what is reported by national sources. Most of this data is based on major metropolitan areas and does not include detailed analysis of rural metropolitan markets. So far, 87 offices have been sold and leased through NETAR’s Commercial Market Listing Service (CMLS). The second local business database does not segment listings or business transactions.
A report by Cushman and Wakefield suggests that most companies will use a hybrid office model and the full impact on future office space demand remains a question mark. A third quarter Crexi market analysis indicates that secondary and suburban centers generated a significant amount of office rentals.
At the end of November, there were 44 office listings in the three-county Johnson City Metropolitan Statistical Area (MSA) and 40 in the four-county MSA of Kingsport Bristol. Kingsport-Bristol’s inventory averages 53 listings per month, while Johnson City averages 43.
The retail sector has recorded 81 CMLS transactions so far this year. They are evenly split between the Kingsport-Bristol and Johnson City metropolitan areas.
CMLS inventory in the industrial sector has fallen from a monthly average of 21 listings to 16. Demand – there have been 49 transactions this year – has depleted much of the inventory, and there is no had a lot of new products added over the past few years. even though there is strong demand for warehouses among companies competing for the growing “last mile” capacity.
Vacant land sales have also remained consistent so far this year. So far this year, this sector has accounted for 40 transactions from the two local trade databases. The average monthly listing volume of 163 fell to 147 in November.
Last month there were 48 new commercial listings, two fewer than last year and 25 fewer than October’s new listing.
Last month’s active inventory was 766 listings, down 7.2% from a year ago.
NETAR is the largest trade association in the Northeast Tennessee and Southwest Virginia region, representing more than 1,500 members and 100 affiliates involved in all aspects of the residential and commercial real estate industries.
