The Birmingham Commercial Real Estate Market

Shanti Ryle

February 25, 2025

Downtown historic-looking buildings in Birmingham, Alabama

Birmingham represents a growing and thriving market where commercial real estate investors and tenants alike can participate and find success.

Crexi provides Birmingham commercial real estate individuals access to a robust library of investment-ready properties in the region and the tools needed to research, identify, and acquire their next investment.

Brokers with Birmingham commercial property harness Crexi's powerful listing management tools to navigate their deals from list to close. To date, Crexi's commercial real estate tools have helped brokers close more than $615 billion in asset value and market more than $7 trillion in investments.

Crexi proudly supports Birmingham, Hoover, Gardendale, Pelham, Trussville, Leeds, and the surrounding communities as the nation's fastest-growing commercial real estate platform.

Birmingham's downtown skyline reflected in a nearby body of water

The State of Birmingham Commercial Real Estate

Birmingham, Alabama, is nestled in the north-central region of the state. It's the seat of Jefferson County, the most populous county in Alabama, and it serves as the central hub of the Greater Birmingham Region, which boasts a population of 1.1 million. This makes Birmingham the largest city in Alabama in terms of area and population.

The city is laid out against the dramatic backdrop of the Appalachian foothills, with its neighborhoods tucked amidst lush, rolling hills and woodland. The landscape of Birmingham is as diverse as its history, which combines industrial might with a vital role in the Civil Rights Movement.

Birmingham's economy is a dynamic mix of businesses and industries, and the city continues to grow and reinvent itself. Today, Birmingham is embracing innovation with a diversified economy that blends its historic manufacturing foundation with emerging tech, advanced services, and creative industries. The city's economic growth mirrors its population growth trends, with nearly 200,000 residents calling the city home.

In Birmingham, you'll find a city steeped in history and filled with culture. This city is home to a rich past and a promising future, from civil rights landmarks to a renewed Theatre District. Whether you're considering relocating, investing, or simply visiting, Birmingham, Alabama, holds a unique blend of Southern charm and urban sophistication.

Birmingham Regional Breakdown

Birmingham’s population trends paint a picture of a city in transformation, where recent revitalization efforts and strategic investments are paving the way for renewed growth. Although the pace of expansion in the region has seen its ups and downs, infrastructure improvements and innovative initiatives are helping drive positive change. Today, Birmingham is emerging as an appealing city that offers economic potential and a high quality of life.

Birmingham is home to nearly 1.2 million in the metro area and nearly 197,000 in the city limits.
Population growth in Jefferson and Shelby counties (where Birmingham is located) has increased an average of 1.4% since 2020.
Cost of living in Birmingham is 8% lower than the national average.
Per capita income in the Birmingham-Hoover metropolitan area is $66,502, about 22% higher than the amount in Alabama overall.
Median household income is $44,376.
Median age is 35.7, compared to 39.6 in the state.

A lit-up sign that says Alabama in a downtown corridor in Birmingham

Birmingham Job Market

The economy of Birmingham remains a dynamic blend of traditional manufacturing and modern service sectors. The city has successfully leveraged its rich industrial heritage to cultivate a diverse, resilient economy that now encompasses thriving industries such as healthcare, advanced manufacturing, finance, and technology. Bolstered by proactive government initiatives and investments in innovation, Birmingham continues to create a wealth of job opportunities.

GDP for Birmingham-Hoover is over $84.5 billion, soaring by 10% over the past two years.
The unemployment rate (as of December 2024) is 2.9%, one of the lowest rates over the past ten years.
Among Birmingham's key industries are health care, education, advanced manufacturing, technology, and financial services.
Major employers in the metro area are the University of Alabama at Birmingham, Wells Fargo, Amazon, St. Vincent's Health System, Children's of Alabama, AT&T, and Honda Manufacturing of Alabama.
Birmingham ranks as one of the best places to live and retire by U.S. News & World Report, with an urban lifestyle and an affordable cost of living.
The University of Alabama at Birmingham, Samford University, and Birmingham-Southern College are the three largest colleges in the metro area.
Close to 31% of residents hold a Bachelor's degree or higher, about 3% higher than the rate in Alabama.
Transportation infrastructure includes key interstates like I-20, I-65, and I-459, Birmingham-Shuttlesworth International Airport (BHM) for air travel, and a comprehensive regional transportation plan that provides for initiatives for rail, highway, transit, and pedestrian modes of transport.

Warehouses outside of Birmingham, Alabama

Birmingham Industrial Market

Birmingham's industrial market continues to show encouraging progress, with 2024 reporting solid positive absorption and a healthy decline in overall vacancy - now at its lowest in two years. Leasing activity remains steady, reflecting the ongoing demand from key sectors like manufacturing and automotive, despite a modest slowdown compared to previous years. Rental rates have continued their gradual climb, an indicator of investor confidence and tightening supply of industrial space. All signs point to the market being well-positioned for positive growth going forward.

Market Overview (Cushman & Wakefield Q4 2024)

Inventory: 17,327,298 SF
Vacancy rate: 9.2%
Absorption: 465,011 SF (YTD)
Key leases by tenant: Royal Switchgear Manufacturing Co. (187,200 SF), Calera Black Friday Deals (150,900 SF), SGO Logistics, Inc. (116,563 SF), GVH Distribution (65,000 SF)
Under construction: 275,000 SF
Largest submarkets: Central, Southern, Oxmoor Valley, Southwestern

Crexi Insights

These are the most recent Birmingham industrial lease and sales trends from Crexi Insights (as of February 2025):

For Lease (active)

Asking rate/SqFt (median): $8 per year
Median SqFt/listing: 12,000
Days on market: 148
Total listings on Crexi: 101 spaces

For Sale (active)

Median asking price: $1.2 million
Price/SqFt: $49
Median asking cap rate: 5.8%
Days on market: 201
Total listings on Crexi: 47

Sales Comps (past 12 months)

Median sold price: $250,000
Sold price/SqFt: $24
Total sales volume: $76.3million
Sold cap rate: 10.2%
Median SqFt sold/transaction: 7,000
Total SqFt sold: 2.8 million
Days on market (median): 187

Find Birmingham industrial space for rent.

Office workers sitting at various cubicles in a well-lit office space

Birmingham Office Market

Birmingham’s market is showing a promising turnaround, with leasing activity stabilizing and overall vacancy rates remaining relatively steady. Although the market faced certain challenges, notable expansions by local employers such as Coca-Cola UNITED and UAB signal continued demand for quality office space. Completed projects like The Hardwick in the Central Business District, coupled with a limited new construction pipeline, look to be setting the stage for tighter vacancies and modest rent growth.

Market Overview (Cushman & Wakefield Q4 2024)

Inventory: 18,697,001 SF
Vacancy rate: 17.4%
Absorption: -102,407 SF (YTD)
Leasing activity (YTD): 562,174 SF
Key leases by tenant: Kratos SRE, Inc. (43,001 SF), Morgan Stanley (29,930 SF), Birmingham Obstetrics & Gynecology, P.C. (25,874 SF), State of AL Department of Education (25,170 SF)
Under construction: 24,000 SF
Largest submarkets: 280/Southern, Central Business District, Midtown

Crexi Insights

You can gain up-to-the-minute data on Birmingham's office market by harnessing the power of Crexi Insights. Here are the latest trends defining the landscape of sales and leases as of February 2025:

For Lease (active)

Asking rate/SqFt (median): $22 per year
Median SqFt/listing: 2,844 SF
Days on market: 259
Total listings on Crexi: 718spaces

For Sale (active)

Median asking price: $1.1 million
Price/SqFt: $166
Asking cap rate: 6.5%
Days on market: 222
Total listings on Crexi: 81

Sales Comps (past 12 months)

Median sold price: $346,500
Sold price/SqFt: $92
Total sales volume: $25 million
Median SqFt sold/transaction: 4,796 SF
Days on market (median): 1,268

Find Birmingham office space for rent.

The otherside of a retail strip in Birmingham, Alabama, at nighttime

Birmingham Retail Market

The Birmingham retail market is seeing a modest slowdown in demand, with absorption trailing below national averages and rent growing at a slower page. Despite these trends, the market still boasts a relatively low vacancy rate. Although rent growth has declined over the past year, the market’s stability continues to attract moderate interest.

Market overview (NAR Commercial Q3 2024)

Inventory: 87,642,646 SF
Vacancy rate: 4%
Absorption: -272,971 SF (12 month)
Rent growth: -2.2% (12 month)

Crexi Insights

Birmingham Retail lease and sales trends from Crexi Insights (as of February 2025):

For Lease (active)

Asking rate/SqFt (median): $18 per year
Median SqFt/listing: 2,400 SF
Days on market: 237
Total listings on Crexi: 407 spaces

For Sale (active)

Median asking price: $1.4 million
Price/SqFt: $166
Asking cap rate: 6.0%
Days on market: 106
Total listings on Crexi: 67

Sales Comps (past 12 months)

Median sold price: $287,500
Sold price/SqFt: $70
Total sales volume: $99.8 million
Sold cap rate: 5.2%
Median SqFt sold/transaction: 4,200 SF
Days on market (median): 285

Find Birmingham retail property for rent.

The back of the "Welcome to Magic City" sign in Birmingham Alabama

Birmingham Multifamily Market

With the average asking rent on the decline and the vacancy rate slowly climbing, Birmingham’s multifamily market appears to be in a period of uncertainty. That being said, the percentage of renter-occupied households has held steady, showing that there is still demand for various housing options.