We’re proud to present our July 2021 Crexi Trends report. Each month, we analyze our platform’s database to discover relevant trends and curate the most interesting insights for our readers.
July’s report features patterns identified 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 equip investors, tenants, and brokers with relevant data to make well-informed commercial real estate decisions.
Average asking prices for new assets dropped despite occupancy gains.
Overall asking prices for new assets added to Crexi in July dropped by 4.71% month-over-month, the sharpest drop since February 2021. In the same period, occupancy rates showed persistent gains, rising more than 2% across asset classes, and continuing their overall growth streak since Q4 of last year. In July, 15.48% of assets were listed as unpriced, up from 14% in June.
Altogether, the pricing drop and occupancy gains indicate that while investors may be lowering or withholding asking prices in response to current market conditions and rising COVID-19 cases last month, tenants continue to capture space at a healthy clip.
Industrial assets indicate slight correction after a record-setting June.
Last month, industrial assets added to Crexi saw asking prices fall by 3.13% following a surge in asking property values in June. The average square footage of new industrial assets rose by 13% in the same period, despite the pricing change.
These changes were potentially impacted by a noticeable increase in unpriced industrial assets on Crexi, which rose to 22.34% of total inventory in July, the highest levels seen since May 2020. Additionally, the increase in unpriced assets pushing the averages down could mean that lower tier deals could potentially have higher pricing confidence.
July added noticeable increase in available lease inventory while average asking rates held steady.
Crexi observed a noticeable jump in new assets available for lease, with inventory levels increasing by more than 57%. This new inventory on Crexi had smaller overall available square footage, with average property sizes dropping 13.1% from June averages. All the while, average asking rates per square foot held steady in July in the leasing market, falling only 1.1% from the previous month.
Office occupancy climbed alongside inventory increases, despite asking price decreases.
Office asking prices dropped the most noticeably on Crexi in July, with averages falling 4.37% month-over-month. Despite these pricing changes, which were perhaps influenced by the looming Delta variant’s effect on office absorption, occupancy levels for offices increased just shy of 3%, continuing their upward climb from Q4 2020. In the same period, office leasing rates remained steady, indicating landlord confidence in the sector’s ongoing recovery.
July also observed significant gains in various office subtypes. Most noticeable was the medical office subsector, which experienced a 46.9% jump in available inventory on Crexi and a simultaneous 27.6% increase in medical-related searches.
New York and Los Angeles attract a surge of search interest, surpassing Texas metros.
Following months of subdued interest levels, New York and Los Angeles’ markets attracted a surge of buyer and tenant interest in July. New York properties for sale drew 32.55% more searches in July than the previous month, while on the tenant side, Los Angeles racked up a 34.16% surge in tenant interest. Populations seem to be slowly returning to larger cities and denser urban areas as work-from-home wanes for many and businesses adapt their office needs.
Despite this shifting attention, Houston and Dallas retained significant shares of buyer activity on Crexi, with buyers seeking property up by 25% and 27% in each respective city.
Highest Average Asking Price per Square Foot By State — July 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.