The New Orleans Commercial Real Estate Market

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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 $440 billion in commercial property value and marketing over $5 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.

The State of New Orleans Commercial Real Estate 

The Greater New Orleans region is an attractive destination for commercial real estate investors, tenants, businesses, and those considering relocating to the city. Nicknamed the “Big Easy” and “NOLA,” New Orleans offers a vibrant culture of music, art, cuisine, festivals, and more. With its growing economy and abundant skilled labor, the city provides an ideal environment for businesses looking to start or expand their operations. 

As a result of its strong economy and generous tax incentives offered by state government programs, businesses in Greater New Orleans have the potential to grow exponentially. The area also boasts a wealth of amenities, such as educational institutions, healthcare systems, entertainment venues, and professional sports teams, that make it a desirable place to live or work. Furthermore, the cost of living is relatively low compared to other cities of similar stature, making it an excellent option for those looking for an affordable place to call home.

New Orleans Regional Breakdown

The New Orleans metropolitan area is home to approximately 1.27 million people, with New Orleans itself totaling 376,971 residents. The city has seen a 9.6% increase in population since 2010, but it still has fewer people than before Hurricane Katrina. Tourism, the oil and gas industry, and shipping drive the area’s economy, and these factors have helped sustain population growth. 

  • New Orleans is the most populous city in Louisiana and the 12th-most populous in the Southeastern US.
  • The metropolitan area comprises the major cities of New Orleans, Kenner, and Metairie.
  • Parishes in Greater New Orleans include Orleans, St. Charles, Jefferson, St. Bernard, and St. John the Baptist, each with its own character and business advantages.
  • Per capita income is $34,354, and median household income is $56,837, both figures about 10% higher than the amounts in the state, according to Census Reporter.
  • Nearly 34% of residents hold a bachelor’s degree or higher, a rate about 25% higher than in Louisiana.
  • The median age is 39.4, a little higher than in the state.

New Orleans Job Market

According to the Bureau of Labor Statistics (BLS), the city’s unemployment rate in February 2023 was 3.6%, slightly higher than the national average. However, there is some good news for the job market. A recent report suggests that the New Orleans area could gain 12,200 jobs by the end of 2024, a 1.6% job growth rate. Industries such as tourism, hospitality, finance, and oil/gas are thriving in the city, offering diverse employment opportunities.

  • According to the St. Louis Fed, New Orleans-Metairie GDP is nearly $70 billion, remaining relatively stable over the past ten years.
  • The BLS reports that the most robust growth employment sectors include mining and logging, construction, financial activities, education and health services, and leisure and hospitality.
  • Key industries in Greater New Orleans includeare technology, advanced manufacturing, trade and logistics, health sciences, energy, offshore wind, and environmental management.
  • New Orleans has been ranked as the #1 major market of the year, one of the top 10 tech markets to watch, and the #1 market for healthcare job growth.
  • Significant employers include Entergy, Pan American Life Insurance, AT&T, IBM, McDermott International, Lockheed Martin, Harrah’s Entertainment, Capital One, and GE Capital.
  • Government institutions in the metropolitan area include the US Fifth Circuit Court of Appeals, NASA’s Michoud Assembly Facility, the National Finance Center, and the US Navy’s Space and Naval Warfare Systems Command.
  • Tulane University, Loyola University New Orleans, Xavier University of Louisiana, and the University of New Orleans are ranked as the best colleges in the New Orleans area by
  • The transportation infrastructure of New Orleans includes five major interstate highways, six Class I railroads, the Louis Armstrong New Orleans International Airport (one of the fastest-growing in the world), and the Port of New Orleans (the fourth-largest port in the US).

New Orleans Industrial Market

The first new industrial project in New Orleans in over 20 years is breaking ground, bringing more than 1 million square feet of warehouse and office space to the market. Propel Park will be home to a major expansion for NASA and Textron Services, a global aviation and military equipment manufacturer. Here are the recent New Orleans industrial trends from NAR Commercial (Q3 2022):

  • Total industrial inventory: 81,730,936 SF
  • Market rent: $9/SF per year
  • Rent growth: 13.2% year over year 
  • Vacancy rate: 1.9% vs. 3.8% in the same period last year
  • Net absorption: 1,689,869 SF over the past 12 months
  • Transaction activity: $7.2 million at a market cap rate of 7.7%

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New Orleans Office Market

With no new office tower construction since the 1980s, the New Orleans office market is trending towards office space redevelopment and flexible leasing options, according to a recent report from Corporate Realty. Landlords are upgrading and developing turn-key office spaces to appeal to tenants as employers find staff is more productive than when working from home. Here are the most recent trends in the New Orleans office market from Cushman & Wakefield:

  • Total office inventory: 26,222,946 SF
  • Overall average asking rent (all classes): $19.25/SF per year, full-service gross
  • Vacancy rate: 11.1% overall
  • Net absorption: -224,251 SF in Q1 2023
  • Investment trends (NAR Commercial): $14.6 million in sales volume (Q3 2022) with a market cap rate of 9.4%
  • Largest office submarkets: Central Business District, Northshore, East Metairie

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New Orleans Retail Market

REI Business Online reports retailers in downtown New Orleans now heavily rely on tourism and convention businesses, with booming growth in the hospitality sector. Banks are consolidating retail operations, presenting opportunities for adaptive reuse. “Medtailers” are also backfilling prime retail spaces in Greater New Orleans and are willing to pay higher rent for well-located real estate. These are the most recent retail trends in New Orleans, as reported in the Q1 2023 Shopping Center report from Cushman & Wakefield:

  • Total retail inventory: 22,117,397 SF
  • Overall asking rent: $18.72/SF per year NNN, an increase of 6.3% year over year
  • Overall vacancy rate: 3.8% vs. 4.8% in the same period last year
  • Deliveries: No new retail space was delivered in the current quarter, with no space under construction
  • Investment trends (NAR Commercial): $88 million in transaction volume (Q3 2022), $244/SF sales price, with the market cap rate at 6.9%

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New Orleans Multifamily Market

According to a report by Multi-Housing News, New Orleans is among the top 10 emerging multifamily markets. The publication notes that since February 2022, the apartment market in New Orleans has been expanding, with a growing job market increasing demand for housing and limited inventory helping to keep rents up and investor demand strong. Here are the multifamily trends in New Orleans from Berkadia’s 2023 Forecast National Apartment Research Report:

  • Total housing units: 576,669
  • Multi-unit inventory: 27% of total housing units, about 1.5 times the rate in Louisiana
  • Vacancy rate: 5.0%
  • Effective rent: $1,314, up 3.0% year over year
  • New construction: 439 units forecast for 2023, the lowest annual total in a decade
  • Transaction activity: $131,956/unit, an increase of 0.5% year over year
  • Median household income: $66,881, up 4.6% year over year
  • Median age: 39.4, about the same figure as the US 

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Get more in-depth New Orleans market data with Crexi Intelligence.

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Shanti Ryle
Shanti Ryle

Content Marketing Manager

Shanti leads Crexi's content marketing strategies with 7+ years of content development experience, creating everything from blog posts to award-winning podcasts. Previously, she worked on content teams at Snapchat, Weedmaps, and HopSkipDrive as well as developed copy, articles, and media for freelance publications.

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