IRR-Charlotte Mid-Year Viewpoint 2015 Local Market Report - Office
Both the Urban/Uptown market continues to show recovery. The Uptown CBD net absorption decreased in 2014 as a result of one major tenant vacating 120,000 Square feet of space but has bounced back in 2015 with a positive 86,000 square feet of net absorption. The market as a hole had a reported a vacancy rate of 14% for the first quarter of 2015 which is slightly improved over 2014 year end. The Charlotte market's net absorption was 160,000 square feet with 50,000 square feet of new construction delivered.
Both class A and B properties had a slight improvement in vacancy in the first quarter of 2015 with class A space at 13.1% is the lowest reported since 2009 at 12.8%. Class B space had a vacancy at 17% which is also the lowest since 2009 which was 17% as well. The Charlotte suburban market has 75,000 square feet of positive net demand and a slight decrease in vacancy which was attributed to several firms taking space between 20,000 square feet and 40,000 square feet.
Institutional investors still remain active in the Charlotte CBD and have purchased two office towers in the first quarter of 2015. The CBD market continues to be a draw with the new minor league baseball stadium and retailers/restaurants servicing the area. There is currently 1.2 million square feet of office under construction in the Charlotte market of which 630,000 square feet is in the CBD. There e is a reported 9 million square feet proposed for the Charlotte area with 1.8 million proposed in the downtown market. The Charlotte MSA can expect steady growth the remainder of 2015. Over the last two years 67,000 net jobs were created in the market according to the SCNC.
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IRR Mid-Year Viewpoint 2015 comprises a National Overview report and 300+ two-page Local Market Reports for all key property types as well as additional resources, including metrics methodology, graphs, and tables; these free reports may be downloaded from IRR’s site here.