Crexi National Commercial Real Estate Report: August 2022
Category: Reports
Welcome to the August 2022 release of our Crexi Trends report. Each month, we analyze Crexi’s database to identify relevant activity and patterns to share key insights with our users.
Our report showcases trends found across Crexi’s commercial property listings in August, evaluating average price per square foot, search behavior, occupancy, and other noteworthy metrics. With this information in hand, we hope to arm principals, tenants, and brokers alike with actionable learnings to make well-informed commercial real estate decisions.
August’s inventory increase lowered the average asking price per square foot, but other market indicators remained solid.
The average asking price for listings that arrived on Crexi in August dipped a slight 2.6% month-over-month, with the change accompanying a glut of new inventory, outpacing what was added in July by nearly 12%. This pricing shift aligned with an overall smaller average square footage in August, the smallest on average since December 2020.
When paired with less than 1% change in occupancy levels and no budge in the number of unpriced listings on Crexi, this explanation paints a portrait of a CRE market well-poised to face uncertain factors such as rising interest rates and inflation.
Industrial commercial property for sale saw a surge of new development hit the market and steady pricing.
Industrial property for sale saw a slight 2% dip in asking prices, likely due primarily to a surge of new supply that hit the market last month. Crexi observed a 10% increase in warehouses for sale compared to July, a 19% jump in general industrial property, and a 17% increase in flex industrial space for sale. As demand rises to meet the newly available supply, we’ll likely see prices adjust and climb again next month.
Office property experienced a second monthly consecutive pricing dip as smaller parcels came online in August.
On Crexi, office listings‘ prices dropped 4.5% compared to the previous month, representing the second consecutive month of declines after reaching their all-time highs in June. Despite the dip, office asking prices on Crexi are still among all-time highs recorded on our platform.
The average size of office assets also changed month-over-month, as more Class B and C office properties came online in August. These offices also decreased the average occupancy as tenants continued their flight to Class A quality: the average occupancy rate for new listings in August lowered to 65% – its lowest average since January 2022.
Leasing rates climbed slightly in August, alongside plentiful new space hitting Crexi compared to earlier this summer.
The average asking rate for leasing space moved a slight 1.5% up from the previous month, representing the second month in a row of asking gains. In the same period, nearly 14% more properties for lease were added to Crexi, ramping up for the potential surge of acquisitions by tenants ahead of the end of the year. Offices led as the primary cohort of new spaces for lease in August: landlords added 19% more coworking spaces, 11.7% more executive office listings, and 6.7% more medical offices to Crexi compared to last month.
Asking rate growth was primarily driven by restaurants and special purpose listings, which saw a 4% and 6% increase in their asking rents. In the case of restaurants, Crexi saw a surge of Class A listings come to market, indicating that experiential retail and dining’s recent successes were at the forefront of landlords’ minds.
Searches for sale in top US metros declined in favor of secondary metros, while leasing searches rose.
The usual metros for most-searched city locations – Houston, Dallas, Miami, and New York City – saw a slight decline in search activity in August from investors specifically exploring property in these cities. Interestingly, we observed increasing interest in Memphis (up 5%) and Philadelphia (up 3%), among other secondary metro areas that attracted searchers’ attention last month.
On Crexi’s leasing platform, most cities saw significant surges in tenant interest compared to July activity levels. Searches for space for lease in Los Angeles and Miami jumped 25% and 19.5%, respectively, likely due to the potential upcoming “return to office” that typically accompanies the fall season. Atlanta (35%), Las Vegas (25%), and Charlotte (32%) were among other metros that enjoyed noticeable gains in search attention last month.
Highest Average Asking Price per Square Foot By MSA — August 2022
Disclaimer: This article’s information is based on Crexi’s internal marketplace data and additional external sources. While asking price in many ways reflects market conditions, variations in pricing are affected by changes in inventory, asset size, etc. Nothing contained on this website is intended to be construed as investing advice. Any reference to an investment’s past or potential performance should not be construed as a recommendation or guarantee towards a specific outcome.