The New Orleans Commercial Real Estate Market

Shanti Ryle

September 19, 2024

Downtown New Orleans street lines with shops and vehicles

New Orleans has experienced radical growth and recovery in the last decade and represents a healthy market to invest in commercial real estate. As one of the South's fastest-growing economies and logistical centers, New Orleans attracts investors and national tenants to its plentiful development and rising population.

Crexi connects parties interested in New Orleans commercial real estate to hundreds of viable properties and the tools needed to research, analyze, and acquire the perfect fit.

Brokers in New Orleans and those representing New Orleans property for sale also rely on Crexi to manage leads, list assets, and navigate more deals to closing, all while saving time. As of this writing, Crexi's commercial real estate tools have assisted brokers in closing more than $610 billion in commercial property value and marketing over $7 trillion in overall assets.

Crexi proudly supports New Orleans, Metairie, Kenner, Laplace, Slidell, and the surrounding areas as the market's fastest-growing online CRE platform.

A view of the more modern side of New Orleans, with downtown buildings poking into the sky

The State of New Orleans Commercial Real Estate

New Orleans is the largest city in Louisiana and is known for its lively culture, rich history, and unique architecture. Located along the Mississippi River, it is a key port in the Southern US and a gateway to the Gulf of Mexico.

The metropolitan area includes the parishes of Orleans, Jefferson, St. Bernard, and St. Tammany. Key industries driving the local economy include tourism, maritime, and oil and gas. Recently, New Orleans has seen a surge in tech startups and creative businesses, propelled by many young professionals and entrepreneurs relocating to the area.

The city's distinctive submarkets offer a wide range of opportunities for commercial real estate investment and development. Areas like the Central Business District (CBD) and the Warehouse District are seeing significant investment in commercial properties, including office spaces, hotels, and mixed-use developments.

New Orleans Regional Breakdown

Population growth in New Orleans has been slow and steady post-Hurricane Katrina. Revitalization efforts and an expanding job market are helping to attract both young professionals and families seeking employment opportunities and a better quality of life.

New Orleans is home to more than 1.2 million in the metropolitan area.
According to data from the United States Census Bureau, the most populous parishes are Jefferson, Orleans, and St. Tammany.
The population has increased by about 5% since 2010.
The per capita income is $37,007, and the median household income is $61,602, both figures that are less than the amounts in the US.
Median household income in New Orleans increased by 8.8% over the past year, based on information on DataUSA.io.

Pedestrians walk down a street lined with shops in downtown New Orleans

New Orleans Job Market

Major sectors of the New Orleans economy include tourism, maritime, oil and gas, healthcare, and education. Key employers such as Ochsner Health System, Tulane University, and Entergy Corporation help keep the job market growing. Government initiatives like the Louisiana Economic Development’s Quality Jobs Program are helping the economy to grow by providing incentives for businesses to create high-quality jobs.

Total Gross Domestic Product for the New Orleans-Metairie MSA is nearly $74 billion, growing by about 1.5% since 2020, according to data from the Federal Reserve Bank of St. Louis.
The unemployment rate is 4.6% (BLS June 2024), while the employed population of New Orleans has increased by about 0.2% year over year.
Key industries include advanced manufacturing, aerospace and aviation, agribusiness, energy, entertainment, life sciences, military/defense, and technology.
Naval Air Station Joint Reserve Base New Orleans in Belle Chasse and the Louisiana National Guard Barracks in the Ninth Ward help support the local economy.
The largest public employers in Greater New Orleans are the City of New Orleans, Jefferson Parish Government, NASA, the United States Army Corps of Engineers, the United States Marine Corps, and the United States Navy.
Major private employers in the metro area include Accenture, Boeing, Chevron, Dow Chemical Company, GE, International Paper, Lockheed Martin, Phillips66, Port of New Orleans, and PricewaterhouseCoopers.
Shell is planning to build a new office in the River District neighborhood, part of a mixed-use development project spanning over 40 acres next to the Ernest N. Morial Convention Center.
Ochsner Health System is expanding with the new Ochsner Children's Hospital, and the redevelopment of theformer Six Flags site is underway.
Major construction firms like Palmisano and RNGD are also expanding their operations in Jefferson Parish.
New Orleans is home to several prominent universities and colleges, including Tulane University, Loyola University New Orleans, and the University of New Orleans.
About 20% of New Orleans residents hold a bachelor’s degree, while 15% have a postgraduate degree, about the same rate as in the US.
The New Orleans region has an extensive transportation infrastructure, including major interstates I-10 and I-610, the Port of New Orleans, and Louis Armstrong New Orleans International Airport (MSY).
Rail volumes at the Port are up by more than 15% so far this year (September 2024), and the Louisiana Legislature has approved over $230 million in infrastructure projects.

A historic, teal-colored building in New Orleans' French Quarter

New Orleans Industrial Market

Due to economic uncertainties and limited speculative development, the industrial market in New Orleans remains relatively quiet, with low leasing and absorption rates. However, recent developments like the new manufacturing logistics hub in Tammany Parish may signal increasing industrial growth going forward.

Market overview (NAR Commercial Metro Market Reports Q1 2024)

Inventory: 84,298,400 SF
Vacancy rate: 2.6%
Deliveries: 345,138 SF (12-month)
Net absorption: -368,513 SF (12-month)

Crexi Insights

These are the most recent New Orleans industrial lease and sales trends from Crexi Insights (as of August 2024):

For Lease (active)

Asking rate/SqFt (median): $10 per year
Median SqFt/listing: 8,250
Days on market: 281
Total listings on Crexi: 39 spaces

For Sale (active)

Median asking price: $1 million
Price/SqFt: $83
Asking cap rate: 7.5%
Days on market: 187
Total listings on Crexi: 19

Sales Comps (past 24 months)

Median sold price: $455,000
Sold price/SqFt: $55
Total sales volume: $2.63 million
Sold cap rate: 7.2%
Median SqFt sold/transaction: 6,710
Total SqFt sold: 31,900
Days on market (median): 60

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A pink-painted hotel in New Orleans' French Quarter

New Orleans Office Market

The New Orleans office market is seeing rising lease prices despite an increasing supply of available space. This trend is driven in large part by a shift in demand. Tenants are willing to absorb the higher rents due to limited alternatives and significant reductions in available office properties due to conversions.

Market overview (Cushman & Wakefield U.S. Office Reports Q2 2024 and Corporate Realty 2023 Greater New Orleans Office Market Report)

Inventory: 26,572,095 SF
Vacancy rate: 11.6%
Net absorption: -480,659 SF (YTD)
Deliveries: 0 SF
Under construction: 0 SF
Leasing activity: 402,632 SF
Significant lease transactions by tenant: First Horizon, Frilot, Merrill Lynch,
Primary submarkets: Central Business District, Orleans Parish (Non-CBD), East Metairie, West Metairie/Kenner, Elmwood

Crexi Insights

If you're in search of the freshest data on the New Orleans office market, turn to Crexi Insights as your first choice. The platform provides up-to-date data on the city's commercial real estate market, including lease trends, sale listings, and comparables.

Here are the latest stats and trends as of August 2024:

For Lease (active)

Asking rate/SqFt (median): $20 per year
Median SqFt/listing: 2,060 SF
Days on market: 282
Total listings on Crexi: 795 spaces

For Sale (active)

Median asking price: $1.75 million
Price/SqFt: $217
Asking cap rate: 10%
Days on market: 191
Total listings on Crexi: 51

Sales Comps (past 12 months)

Median sold price: $742,000
Sold price/SqFt: $94
Total sales volume: $25.6 million
Sold cap rate: 10.4%
Median SqFt sold/transaction: 9,489 SF
Days on market (median): 276

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A street band plays in New Orleans' French Quarter during the day, as pedestrians walk by

New Orleans Retail Market

The retail market in New Orleans is undergoing significant changes as it adapts to evolving consumer behaviors, and no new construction or deliveries. Retailers are focusing on creating memorable, experience-driven shopping environments both in downtown areas like Canal and Magazine Streets and in suburban hubs such as Metairie and Elmwood.

Market overview (Cushman & Wakefield U.S. Shopping Center Reports Q2 2024)

Inventory: 22,216,759 SF
Vacancy rate: 3.7%
Under construction: 0 SF
Deliveries: 0 SF (YTD)
Net absorption: -18,501 SF
Leasing activity: 2,101,368 SF

Crexi Insights

New Orleans retail lease and sales trends from Crexi Insights (as of August 2024):

For Lease (active)

Asking rate/SqFt (median): $24 per year
Median SqFt/listing: 2,000 SF
Days on market: 202
Total listings on Crexi: 333 spaces

For Sale (active)

Median asking price: $1.72 million
Price/SqFt: $288
Asking cap rate: 6.5%
Days on market: 179
Total listings on Crexi: 66

Sales Comps (past 12 months)

Median sold price: $795,000
Sold price/SqFt: $119
Total sales volume: $36.4 million
Sold cap rate: 7.2%
Median SqFt sold/transaction: 5,835 SF
Days on market (median): 233

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The New Orleans cityscape with multifamily buildings in the foreground and the Mississippi River in the background

New Orleans Multifamily Market

The New Orleans multifamily market is reporting recovery and stability, with increasing rent growth and steady occupancy rates. Demand has surged in more affordable suburban areas like Westbank and Algiers, while higher-cost neighborhoods face flat rent gains and reduced leasing activity.

Market overview (MMG Real Estate Advisors Multifamily Market Report Q1 2024)

Total housing units: 580,426
Multi-unit inventory: 16,944 units
Vacancy rate: 8.7%
Average rent: $1,246
Rent change: 2.3%
Deliveries: 113 units
Absorption: 179 units
Under construction: 645 units
Largest submarkets (by occupancy): St. John The Baptist Parish, St. Charles Parish, St. Bernard Parish