The Raleigh Commercial Real Estate Market

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Raleigh, North Carolina’s “City of Oaks,” stands tall as one of the nation’s fastest-growing commercial real estate investing and leasing markets.

The dynamic metro area has seen a surge in population and employment growth in the last decade, making it a competitive market for office and retail investments as the city expands. Crexi equips individuals seeking to invest or lease in Raleigh commercial real estate with the tools to search, analyze, and transact property quickly.

Raleigh brokers, and those representing Raleigh properties nationwide, harness Crexi’s robust platform and marketing tools to develop their network and close more deals. Crexi-empowered brokers have completed more than $440 billion in commercial transactions, representing more than $5 trillion in property listings.

Crexi proudly supports Raleigh, Chapel Hill, Durham, Garner, Cary, and surrounding communities as the region’s fastest-growing online CRE platform.

The State of Raleigh Commercial Real Estate 

Raleigh, North Carolina, is an exciting city with a vibrant economy and rich cultural amenities. It is the capital of the state, home to major universities, and located in the heart of the Research Triangle region. 

Raleigh has been recognized as one of the top cities for business and career opportunities, with a strong job market and plenty of entrepreneurial resources. The cost of living is relatively low compared to other metropolitan areas in the United States.

In terms of commercial real estate investment, Raleigh presents numerous opportunities. From thriving downtown districts to expansive industrial parks, all kinds of spaces can be tailored to fit individual needs. With its access to an educated workforce and government incentives, the region is ideal for businesses looking to expand or relocate. 

Raleigh Regional Breakdown

More and more people realize the appeal of living in Raleigh, North Carolina. With remote work options available, there is no reason to stay tied down to coldNortheast and Midwest states. Instead, they can look south for a better climate, better job opportunities, and a cost of living lower than the national average:

  • Raleigh is home to over 469,000 residents, with over 1.4 million in the metropolitan area.
  • The Raleigh MSA comprises Wake (where Raleigh is the county seat) and Durham counties.
  • Between 2010 and 2021, the city grew by about 16%, while Wake County and Durham County grew by 27% and 22%, respectively, according to the most recent census.
  • reports the population of the Raleigh-Cary Metro area is projected to increase from 1.5 million to over 2.6 million by 2060.
  • Primary suburbs and cities near Raleigh include Cary, Morrisville, Wake Forest, Apex, and Fuquay-Varina.
  • The median age is 37.7, slightly less than the figure in North Carolina and the US.
  • Nearly 30% of the population is between 30 and 49.

Raleigh Job Market

The Kenan Institute’s American Growth Project report ranked Raleigh and Durham fourth as the cities with the highest growth potential in 2022. The report dubbed this region a “powerhouse” for biotech, putting Raleigh shoulder to shoulder with other cities renowned for their advanced development, such as San Francisco and Seattle. Despite the potential downsizing of industries across the country, the Research Triangle is expected to remain strong as a leader in technology.

  • The GDP of Raleigh is over $108 billion, nearly doubling over the past ten years, according to the St. Louis Fed.
  • Unemployment in the Raleigh-Cary metro area is down to 2.7% (BLS December 2022), the lowest rate over a decade.
  • Key target industries in Raleigh include life sciences, advanced manufacturing, IT and technology, and clean tech/smart grid.
  • A Wake County Economic Development report reveals that Raleigh is ranked #1 for the lowest unionization rate, #2 for the best place for IT pros to live and work, and #3 for the fastest-growing cleantech cluster.
  • Major employers in Wake County and the Research Triangle Park (RTP) include Duke University and Duke Health Systems, the State of North Carolina, Wal-Mart, the University of North Carolina at Chapel Hill, Food Lion, IBM, and Fidelity Investments.
  • Wake County is the second most educated city in the US; the region is home to the tier-one universities of North Carolina State, Duke, and the University of North Carolina.
  • Nearly 51% of the city’s residents hold a bachelor’s degree or higher, about 1.5 times the rate in North Carolina and the US.
  • Transportation infrastructure includes numerous US Highways and Interstates, including I-40, that connect Raleigh to the RTP, Amtrak and freight rail services, BikeRaleigh, and the Raleigh-Durham International Airport.

Raleigh Industrial Market

Over the past year, the Raleigh area has seen tremendous strides in its industrial and life science sectors. Nonfarm employment rose 4.6% year-over-year (YOY), with job growth in the manufacturing industry and the trade, transportation, and utilities sector expanding by 2.8% and 0.5%, respectively. 

The industrial vacancy rate decreased 30 basis points (bps) YOY to 5.4%, with more than 873,000 square feet (SF) of new buildings delivered in Q4. This is indicative of Raleigh-Durham’s appeal as an industrial powerhouse that continues to thrive and attract new businesses, according to Cushman & Wakefield’s Q4 2022 Raleigh Industrial Report:

  • Total industrial inventory: 56,069,685 SF
  • Average asking rent: $20.96/SF per year NNN, up 17% year over year
  • Vacancy rate: 5.4%
  • Absorption: 1,036,171 SF (Q4 2022)
  • Leasing activity: 3.8 million SF year to date
  • New construction: 2.1 million SF delivered YTD, with nearly 4.5 million SF currently under construction
  • Recent sales activity: TBC by Alloy $141 million ($307/SF), Catalyst BioCampus $40.5 million ($193/SF) 
  • Largest industrial submarkets: RTP/I-40 Corridor, Eastern Wake County, US 1/Capital Blvd.

Discover Raleigh industrial space for rent.

Raleigh Office Market

The Raleigh-Durham office market had a successful fourth quarter of 2022, with 184,000 square feet in positive absorption, helping to end the year on a high note. According to Newmark, Class A contributed 118,000 sq. ft., Class B added 97,000, and Class C returned 31,000 to the market for a total of over 1 million sq. ft. at year-end:

  • Total office inventory: 53,967,104 SF
  • Overall average asking rents: $29.94/SF per year, full-service gross
  • Vacancy rate: 13.1%
  • Absorption: 1,381,552 SF in 2022
  • Key leases by submarket: Cary 42,050 SF, Downtown Raleigh 26,617 SF, Glenwood/Creedmoor 25,813 SF, Six Forks/Falls of Neuse 17,792 SF
  • New construction: 1.2 million SF currently under construction
  • Investment sales trends: $182 million in acquisitions in Q3 2022, market cap rate 7.1% (NAR Commercial Metro Market Reports Q3 2022)
  • Largest office submarkets: Research Triangle, West Raleigh, Cary, Six Forks/Falls of Neuse 

Discover Raleigh office space for lease. 

Raleigh Retail Market

Raleigh-Durham’s retail sector remains resilient, with net absorption of 380,000 sq. ft. pushing vacancy down 40 basis points year-over-year. Downtown Raleigh is undergoing a resurgence in the food and drinks scene, while Fenton in Cary presents one of the largest mixed-use developments this year. It boasts top retailers and eateries such as Williams Sonoma and Pottery Barn. Here are the most recent Raleigh retail trends, according to data from CBRE and NAR Commercial:

  • Total retail inventory: 42,133,774 SF
  • Average asking rent: $24/SF per year, NNN
  • Vacancy rate: 6.7%
  • Absorption: 1.3 million SF over the past 12 months
  • Key leases by tenant: TJ Maxx 23,000 SF, Pop Shelf 12,960 SF, Skechers 10,400 SF
  • New construction: 329,328 SF under construction
  • Investment sales trends: $225.5 million in acquisitions in Q3 2022, average sales price $280/SF, cap rate 6.5%
  • Key sales by building: Waverly Place $88.5 million, At Home $11.5 million, Parkwest Crossing $13.25 million
  • Largest retail submarkets: Cary, US 1/Capital Blvd, Southern Wake, South Durham

Discover Raleigh retail property for lease.

Raleigh Multifamily Market

The Wake County multifamily market saw some cooling in the third quarter, with rents decreasing slightly and the vacancy rate increasing. This is due to an uptick in new unit delivery, reversing the supply-demand imbalance seen in 2021. Over a dozen projects are planned for completion by the end of the year across Morrisville, Cary, and Wake Forest. 

According to the most recent Market Insights report from Northmarq, developers remain active despite slowing rent growth, indicating the long-term strength of the Raleigh-Durham multifamily market:

  • Total housing units: 903,974
  • Renter occupied: 34%
  • Multifamily inventory: 307,351 units
  • Average asking rent: $1,603
  • Rent growth: 9.3% year over year
  • Vacancy rate: 5.3%
  • New construction: 6,414 units delivered YTD, with 16,557 units under construction 
  • Investment sales trends: Median sales price $264,800/unit, up 32% year over year, with cap rates holding steady at 3.7%
  • Recent sales activity: Bainbridge Aviation Crossing $120 million, The Lex at Brier Creek $99.7 million, Alister Lake Lynn/FKA The Mark $79 million
  • Median age: 38.1, a little less than the figure in North Carolina
  • Per capita income: $42,683, about 20% higher than the amount in North Carolina 

Discover Raleigh multifamily property for sale.

Get more in-depth Raleigh 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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