We’re proud to present our January 2022 Crexi Trends report. Every month, we crawl our platform’s database to discover and analyze relevant trends to curate the most actionable insights for our readers.
January’s report identifies patterns observed across Crexi’s commercial real estate listings in average price per square foot, search behavior, occupancy, and other relevant metrics. With this research, we seek to provide investors, tenants, and brokers with the insights they need to make well-informed investing decisions.
January asking prices surpass Crexi’s all-time highs.
For new listings added in January, the average asking price per square foot jumped up 10.4% from December new listings. This number represents the highest average asking prices we’ve seen on Crexi and indicates a commercial real estate market that’s emerged swinging from a sleepy holiday season as well as one that’s all but stepped beyond COVID-19’s impact.
The gains also coincide with an increasingly fluctuating stock market in January, indicating commercial real estate’s status as a more secure long-term investment than other sectors. As the Fed prepares to hike interest rates in March, it’s also likely sellers are seeing increased demand from buyers seeking to acquire space while borrowing costs remain low.
Multifamily and retail experience the highest pricing gains while all asset classes climb.
While every asset class experienced impressive pricing gains in January, multifamily’s average asking prices grew the most noticeably, up 12% from December numbers. As more entities turn to CRE as a stable investment, multifamily – one of the most resilient asset classes – became all the more attractive, as pricing gains reflected.
Retail also staged an impressive comeback, with asking prices shooting up 9% from the previous month. Occupancy levels for retail also indicate the asset class’ continued recovery from COVID-19 induced pressure, with 5% more space occupied in the last month as more and more businesses return to work and can pay rents consistently. This coincides, too, with a surge of new retail subtypes listed on Crexi, a 28% gain in restaurant listings for sale added to the platform in January compared to the previous month.
Leasing rates for new space on Crexi see a slight decline amid a surge in supply.
On average, asking rates per square dropped a slight 2.8% month-over-month in January. Zooming in on different asset classes, the change was even less noticeable: industrial assets posted hardly any difference in asking rates, continuing to demand top dollar from high-demand warehouse space.
Office and restaurant leasing rates decreased by less than 2% compared to December, indicating stability even as with a surge in new space added on the platform, particularly medical offices (up 20%) and coworking spaces (up 39%). It’s likely rates will steadily start to climb as employers finalize hybrid work and restaurants continue to welcome patrons back to sit-in dining.
As buyers and tenants resume post-holiday activity, Southern metros enjoy a glut of attention.
Houston was the big winner for both buyers and tenants in January, commanding a 38% gain in buyer activity and 53% gain in tenant searches compared to the previous month and reigning in the top spot for the most-searched city.
Dallas and Miami respectively enjoyed 39% and 57% gains in search attention on the buyer side, as investors sought to take advantage of each state’s investment-friendly tax environment and population growth. Chicago and Omaha represented a growth in tenants’ interest in the midwest cities on the leasing side, with 53% and 28% gains in tenants looking to lease space.
Highest Average Asking Price per Square Foot By State — January 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.