Welcome to the February 2023 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 February, 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.
Overall National Sales Trends
What the Data Says
- Average asking prices rose 7.55% in February compared to month-over-month data
- Occupancy rose from 78.9% to 81% in February, regaining an average absorption volume that has been dropping since November 2022.
- February had the lowest-ever number of unpriced new listings (10.9%) since April 2020.
- We saw a 16% inventory increase in new listings added last month compared to January.
Asset Type Trends
- Industrial assets’ average asking prices rose 8.5% month-over-month. It’s important to note however, that many more listings removed pricing – ⅕ of new listings obscured valuations in February.
- Multifamily average asking prices rose 41.6%, mainly due to many new developments hitting the market in New York City. At the same time, an impressively small 5.75% of listings are unpriced – the lowest in Crexi history.
- Office and retail asking prices dropped <2%, respectively, but both have observed steady gains in occupancy in the last three months.
Key Takeaways
The upward trend of average asking prices was largely driven by gains in industrial and multifamily assets for sale and returning seller confidence amid current market fluctuation. Sellers hitting the market last month felt more confident in their valuations, as indicated by the small percentage of unpriced listings (especially in multifamily) overall as we observed a glut of new inventory. Industrial’s behavior offset this trend, however, indicating some more listing competitiveness in the pandemic-proven sector and an interest in moving pricing discussions to later in the transaction flow.
Office’s minimal pricing movement and gradual increase in occupancy in 2023’s early months mirror the upward, slow-moving trend of companies calling (or forcing) their employees back to the office and struggling with resistance.
Overall National Leasing Trends
What the Data Says
- Average asking rates for new listings nationwide fell slightly in February, down 1.86% compared to January.
- We observed a glut of new inventory in February, up 9.2%, to hit the second-highest most assets added in a single month in Crexi history (November 2022 was the highest).
Asset Type Trends
- Industrial average asking rates per square foot moved less than 1% in February.
- Offices and retail lease spaces slightly dropped their asking rates by 1.3% and 3.7%, respectively, with little inventory change.
- Restaurants experienced a more noticeable drop in asking rates, down almost 8% from January, but saw a significant jump in inventory, with 27.7% more listings added to Crexi than the month prior.
Key Takeaways
The leasing market remained relatively stable overall in February, with no significant shifts in asking rates or tenant behavior from the start of the year. The slight corrections in retail leasing spaces added in February suggest increased competition among available units, as tenants become more picky with their contracts to be as careful as possible with operational costs. The restaurant asset class’s more significant dips strongly underline these strategies, especially as restaurant operators contend with hiring challenges and supply shortages.
Regional Breakdown
What the Data Says
- Houston was the number one searched city on Crexi in February, with sales searches up 8.5%, but despite its ranking, lease searches were down 7% for the city.
- Charlotte and Miami experienced the biggest search growth spurts in February, with 23% and 11% more buyers looking in these markets.
- California cities such as San Jose, Santa Barbara, and Riverside saw massive increases in asking prices, displacing New York City as the market with the highest valuations.
- Overall, 80% of the top ten major metros experienced increases in buyer search activity, whereas 90% of our top ten cities for leasing searches saw slight dips.
Highest Asking Price by MSA — February 2023
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.
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