Crexi National Commercial Real Estate Report: May 2022

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Welcome to the May 2022 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 May, 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.

Average Asking Price per Square Foot and Changes Month-over-Month

Average asking price growth stalled following April increases.

The average asking price for assets added to Crexi in May hardly moved compared to the previous month, representing a slowdown from April’s all-time highs. Occupancy levels climbed slowly – up 1% in May – but have shown steady gains since January as tenants continue filling available space.

We also observed a noticeable 18.5% increase in new assets added in May versus April. We can attribute this increase to sellers looking to dispose of assets before expected interest rate hikes

Industrial saw an influx of various property types hitting the market last month.

Industrial properties for sale added to Crexi last month showed a slowing rate of increase, following consecutive months of more noticeable pricing growth. In the same period, Crexi witnessed a surplus of industrial supply hit our marketplace compared to April:

  • 26% more manufacturing facilities
  • 23% more warehouses
  • 18% more distribution facilities

 Despite these increases in supply, an unchanging price average proves that sellers continue to perceive high demand for industrial assets on the part of both buyers and tenants.

Office asking prices hold steady but experienced their first occupancy decline of the year.

In May, offices added to Crexi’s platform showed minimal fluctuation in average asking price per square foot, despite slight changes in available square footage per unit. However, occupancy levels dipped 2%: their first decline since the end of 2021. 

These changes could be early signs of businesses dealing with the fallout of adjusting their office spacing needs, particularly in offering hybrid or remote options to picky candidates amid a constricted labor force.

Restaurants were the only subtype to see rent growth, up 9% month-over-month.

In May, new restaurants added to Crexi demanded a noticeably higher average rent per square foot, up 9% compared to April rates. The asset class was the only one – on both the sales and leasing side of Crexi – to show more than a 3% fluctuation in pricing.

Hiked prices coincide with returning demand for restaurants, as people starved for in-person interactions flock to sit-down dining experiences. Restaurants and restaurant spaces are experiencing valuation gains as a result.

Check out new restaurants for rent on Crexi.

Cities are receiving less attention than specific asset or deal types.

Overall, we observed fewer people on Crexi electing to search by specific markets. Instead, we saw an increase in property-seeking by asset type and other search factors. In Crexi’s most popular markets, we saw declines in the usual top searched cities, Houston (down 11.4%), Dallas (14.7%), and Miami (17%). The leasing side experienced similar declines in cities as search criteria.

These interesting shifts represent the third consecutive month of decreased interest in cities, supporting that investors are increasingly focused on value-add acquisitions over specific markets. Tech tools like Crexi also make it easier to find specific investments on a national scale. 

Highest Average Asking Price per Square Foot By State — May 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.

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Crexi Insights
Crexi Insights

Marketing Team at Crexi

Crexi makes CRE easy by consolidating the entire commercial real estate process into a single ecosystem.

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