Crexi National Commercial Real Estate Report: June 2021
Category: Reports
We’re proud to unveil our monthly Crexi Trends report for June 2021. Each month, we analyze our platform’s database to identify relevant patterns and share the most interesting insights with our readers.
June’s report features trends across Crexi’s CRE listings based on average price per square foot, search behavior, occupancy, and other notable data. With this information in hand, we seek to arm investors, tenants, and brokers with actionable takeaways to make well-informed commercial real estate decisions.
The relative stability of June’s average asking prices indicates a consistent path towards market growth, despite lower occupancy.
In June, the average asking price per square foot across all assets remained relatively stable, decreasing only 1.52% from May averages. An increase in unpriced listings and the activation of many smaller units likely account for most of the decline. The slight shift, following a few months of minimal change, indicates that the market is settling into a return to normalcy.
While asking prices remained stable, average occupancy took a slight 1.89% dip month-over-month. However, the number still represents a jump of 5.44% from the pandemic era’s lows in November 2020. Regardless, the tenant market has plenty of available space to reclaim: occupancy averages are still 8.33% below year-over-year levels, when the market was only three months into the pandemic and before many tenants started negotiating and adjusting their leases.
Average office asking prices rise alongside a surge in inventory.
Office asking prices are steadily forming a healthy gait towards recovery, jumping 5.17% in June. In the same period, a glut of office inventory hit the market: a 20.8% increase in the amount of flex office space, 36.7% increase in creative space, and 24% increase in executive office space available for sale.
On the leasing side, average asking rates for office rentals stayed steady within 0.5% of the previous month’s averages, while the flex office leasing space saw similar inventory gains. The simultaneous rise in office space values and steadiness of asking rates points to a promising spurt of activity in offices, particularly as corporate tenants finalize and implement their return to work plans.
Multifamily saw its first decline in average asking prices since March 2021.
In June, multifamily properties for sale saw their first decline in average asking prices since March 2021. Prices fell 6.7% month-over-month, coinciding with the pending end of eviction moratoriums in July and correlated anticipation of rent distress.
Despite this fall, multifamily asking prices are still up 22.9% year-over-year metrics, and the asset has cemented itself as one of the most stable investment classes in a post-covid economy.
Asking lease rates, while still down year-over-year, show promising recovery ahead.
Average asking lease rates remained stable in June compared to the previous month, with minimal changes in average asset size and occupancy rates. Consistent asking rates point to a steady ramp up towards recovery in the second half of this year. Despite the leasing markets’ 1.66% drop from June 2020 metrics, we are a far cry from January 2021’s lows.
Southern and Midwestern states attract growing buyer interest, while coastal cities fall behind.
Houston was the star of searches on Crexi in June, with buyers seeking property 14% more and tenants searching 20.6% more than their respective activity in May. Dallas also saw a healthy 14.8% gain in search activity, while Atlanta and Omaha properties attracted 15% and 14.66% more search attention, respectively.
Coastal cities, conversely, saw either minimal gains or slight decreases in search activity last month. Los Angeles buyer interest rose only 2.05% from May metrics, slightly less than the overall site average, while New York searches declined by 7.56%. This potentially indicates that in-market opportunities unveiled by the pandemic have been picked dry. On the leasing side, Miami saw a 7.69% decrease in tenant searches, which perhaps occurred in the wake of the tragic collapse of the Surfside condominium in June.
Highest Average Asking Price per Square Foot By State — June 2021
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.