What’s Happening in Memphis Commercial Real Estate

Reading Time: 6 minutes

Memphis, Home of the Blues, leads the US as a hotbed of commercial real estate investment and tenant activity.

Tennessee’s second-largest city has experienced a surge of business expansion and robust job growth, attracting tenants and investors alike. Crexi’s marketplace connects interested individuals to thousands of commercial real estate opportunities in Memphis and providing them with the best tools to research and transact properties. 

Memphis brokers and those representing Memphis properties can harness Crexi’s powerful lead management and listing tools to connect with more leads, build their networks, and win more deals. As of today, Crexi has enabled brokers to close over $300 billion in commercial property deals, representing over $1.2 trillion in assets.

Crexi proudly serves Memphis, Bartlett, Lenox, Germanton, Lakeland, Egypt, and the surrounding neighborhoods as the region’s fastest-growing online CRE platform.

The State of Memphis Commercial Real Estate 

Memphis is a global transportation hub, with companies like FedEx and UPS spending nearly $2 billion on hub expansion and modernization. The state government has a long history of being business-friendly, encouraging the world’s first hotel chain and first self-serve grocery store to open in Memphis.

Located along the Mississippi River in southwestern Tennessee, Memphis is the 2nd-largest city in the state behind Nashville, and the 42nd-largest metropolitan area in the US. Key industry sectors such as advanced manufacturing, agribusiness and technology, as well as transportation and logistics help keep the population growing, job opportunities strong, and the demand for commercial real estate in Memphis robust.

The music and entertainment industries in Memphis do their fair share to bolster the economy as well. Blues, soul, and rock ‘n roll are everywhere, while major motion pictures filmed in Memphis include The Firm, The Silence of the Lambs, and Black Snake Moan.

Memphis Regional Breakdown

The Memphis metropolitan area has grown almost 4% over the last decade, with job opportunities and the market’s affordable housing attracting both residents and businesses:

Memphis has been ranked as the top metropolitan area for job creation over the past ten years. Looking at the diverse mix of industry and business in the region, it’s easy to understand why the job market in Memphis is robust. FedEx, UPS, and AutoZone are three of the Fortune 500 companies that call Memphis home, along with thousands of other companies attracted to the pro-business environment of Memphis:

  • The GDP of the Memphis, TN-MS-AR MSA is just under $79 billion and has grown by almost 36% of the last decade.
  • Employment in the Memphis metropolitan area has grown by 0.47%, while median property values rose nearly 6% over the past 12 months.
  • Job growth in Memphis over the last ten years outperformed similar smaller cities, including Raleigh and Minneapolis-St. Paul.
  • Per capita income in Memphis is $30,690, while median household income in the metropolitan area is $54,859.
  • The unemployment rate in Memphis is 6.3%, according to the most recent survey by the Bureau of Labor Statistics.
  • Major employers based in the Memphis region include American Residential Services (Rescue Rooter), AutoZone, FedEx, First Horizon National Corporation, International Paper, Mid-America Apartments, Mueller Industries, and ServiceMaster. 
  • Key industry sectors in Memphis include advanced manufacturing, agribusiness, corporate and professional services, food and beverage processing, medical device innovation, and transportation and logistics.
  • Small businesses also power the job market in Memphis, accounting for nearly 30% of the region’s economic output.
  • Major colleges and universities in Memphis include the University of Memphis, Rhodes College, Christian Brothers College, and University of Tennessee Health Science.
  • 88% of Memphis residents are high school graduates or higher, while 29% hold a bachelor’s degree or an advanced degree.

Memphis International Airport (MEM) is the world’s busiest cargo airport, moving 4.61 million tons of cargo last year for companies like FedEx and UPS. Memphis’ transportation infrastructure includes two major Interstate Highways, five major freight railroads, and the International Port of Memphis is the second-busiest cargo port on the Mississippi River.

Memphis Industrial Market

Demand for industrial space in Memphis is surging, with net absorption skyrocketing to 3.2 million square feet. Once again, the Memphis International Airport is ranked as the world’s busiest cargo airport, pushing Hong Kong International into second place. In the future, FedEx’s $1.5 billion modernization and expansion plan and UPS’s $216 million expansion plan should keep the Memphis industrial market strong:

  • Total industrial inventory: 270,103,832 SF
  • Average asking rent: $3.46 per SF per year, net
  • Vacancy rate: 5.0%
  • Absorption: 3,200,000 SF Q1 2021
  • New construction: 217,312 SF delivered with 16,193,809 SF under construction as of Q1 2021
  • Largest industrial submarkets: Southeast, Desoto County, Southwest, Northwest

Discover Memphis industrial space for rent.

Memphis Office Market

Net activity in the Memphis office market  is low, as the city, along with the rest of the world, awaits the long-term effects of the pandemic. On the upside, asking rents and vacancy rates have remained steady, with an increase in office transaction activity for deals of +10,000 square feet and  under 2,500 square feet:

  • Total office inventory: 25,834,845 SF
  • Average asking rents: $19.20 per SF per year, full-service gross
  • Overall vacancy rate: 15.5%
  • Absorption: – 181,173 SF as of Q1 2021
  • New construction: 197,840 SF of office space under construction
  • Largest office submarkets: East, Downtown, 385 Corridor, Northeast

Discover Memphis office space for lease. 

Memphis Retail Market

Heading into 2020, the Memphis retail market remained historically tight while asking rents and vacancy rates held steady. For the most recent reported quarter, net absorption was positive for the first time in four quarters. Over the long term, local CRE experts predict that the Downtown and Midtown retail submarkets in Memphis will become more active in the following years:

  • Total retail inventory: 37,737,916 SF
  • Average asking rent: $14.49 per SF per year, NNN
  • Total vacancy rate: 7.0%
  • Net absorption: +51,869 SF Q4 2020
  • New construction: 6,564 SF delivered YTD 2020 with 302,298 SF under construction
  • Retail market trends: Mixed-use and adaptive reuse developments are driving construction activity, with the market shifting from large centers to smaller retail spaces

Discover Memphis retail property for lease.

Memphis Multifamily Market

The Memphis multifamily market stood out as the top performer last year, posting the highest multifamily rent growth in the entire US. Vacancy rates were lower than the national average as demand for apartments in Memphis exceeded the supply. 

Strong demand for workforce housing and job growth in the industrial and transportation sectors should keep the multifamily market rent in Memphis  rising and cap rates at historic lows:

  • Total housing units: 573,811
  • Renter occupied: 41%
  • Average rent: $887 per month
  • Average cap rate: 6.0%
  • Vacancy rate: 4.8%
  • New construction: 840 units delivered in 2020
  • Multifamily market trends: Limited pipeline of new supply should keep vacancy rates steady, with affordable and workforce housing seeing the strongest demand
  • Median household income: $54,859
  • Per capita income: $30,690

Discover Memphis multifamily property for sale.

How Crexi Connects Buyers and Tenants to Memphis Commercial Real Estate

Memphis draws investors and tenants from across the country. Crexi’s easy-to-use search features make it easy to find the perfect match among thousands of property listings with a few simple clicks.

Buyers and tenants can browse Memphis commercial property for lease or sale by square footage, price, or rate per square foot, asset class, vacancy, cap rate, and even neighborhood.

When ready to pursue a property, buyers and tenants can instantly connect with the listing broker to get more information. Property seekers can also instantly download PDFs and brochures, submitting a letter of intent (LOI) directly from the property’s page.

Intelligence Equips Investors with Data and Market Knowledge 

Crexi Intelligence offers relevant market and demographic insights to investors seeking in-depth market information. 

Intelligence’s library contains millions of property records and sales comparables, as well as over 50 up-to-date market reports. The Insights tab, included on every property page, provides principals with real-time information about the market of interest, including square footage, average asking price, demographic insights, and more.

Intelligence is available to buyers, sellers, and tenants on a subscription basis.

How Memphis Brokers Thrive with Crexi

Memphis brokers use Crexi to market nearly 250 properties for sale and 600 listings for lease within the city limits. Commercial agents in Memphis represent a healthy collection of CRE opportunities, primed for investors and tenants alike to take advantage of.

Crexi’s broker tools equip Memphis brokers with what they need to market their properties to a national buyer pool. The powerful broker dashboard reveals real-time insights about leads, allowing CRE brokers to connect with potential buyers or tenants instantly.

Memphis commercial brokers can also list their assets across property types, including: 

  • Industrial buildings
  • Land parcels
  • Multifamily housing
  • Retail assets
  • Offices developments
  • Mixed-Use buildings
  • Hospitality assets
  • Non-traditional properties such as self-storage, data centers, etc.

Memphis commercial brokers use Crexi to guide their clients’ buildings from list to final close, with file management and secure storage supplied to house due diligence paperwork.

And while Crexi’s free broker suite is impressive, Crexi’s real advantages emerge with Sale PRO, Lease PRO, and All PRO

Crexi PRO Dashboard 2020

Crexi’s All PRO Membership

Crexi PRO elevates and simplifies Memphis brokers’ processes, thanks to advanced tools designed to help close more deals. PRO brokers use Crexi to access highly detailed lead data, manage their listings, and efficiently report on pipelines. With PRO, brokers can prioritize making connections and engage with the highest value leads.

Brokers with PRO also enjoy preferential tile positioning for their assets at the top of Crexi’s search pages. Crexi searches are powered by machine-learning to connect brokers with targeted property seekers. PRO also sends out weekly email blasts, connecting PRO properties to relevant property seekers, achieving 10-15% higher engagement rates than industry benchmarks.

PRO users can access Intelligence as part of  their subscription, allowing them to build in-market knowledge and offer further value to their clients.

Crexi PRO allows brokers to easily connect with the over 146,000 leads who have sought Memphis properties in the last two years and the over 3 million leads across the nation who looked for a property on Crexi in 2020.

On average, Crexi PRO brokers successfully win 125% more leads and close up to eight times more deals than non-PRO users. 

Contact support@crexi.com to learn more about All PRO.

Similar Articles

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.

Share This Article