President’s Message

President’s Message

Here’s a statistical update on the Commercial Real Estate Markets in in the U.S. and the Metro Market of Manchester, NH.

Nationally, Office occupancy fell by 2.3 million sq. ft. compared to 3 months ago, after rising in the second quarter. From 2020 Q2 to date, 131.4 million sq. ft. of office space has become unoccupied. The vacancy rate is at 12.6%. The average asking rent is down by 0.5%. 139.8 million sq. ft. is under construction, equivalent to 1.7% of the current office inventory. Some of the ongoing construction will add to vacant space so expect vacancy rates to remain over 10% in 2022. Cap rates decreased to 6.8%. In NH the vacancy rate was 9.8% on an inventory of 19.62 million sq. ft. In the last 12 months there was 90,111 sq. ft. of leasing and minus 345,471 sq. ft. of absorption.  Cap Rates average 8.7%

In the National Industrial market, occupancy increased by 125 million sq. ft. compared to three months ago, with a total of 670 million sq. ft. of industrial space absorbed since 2020 Q2. The vacancy rate is has fallen to 4.4%, the lowest rate among the core commercial markets. The average asking rent per sq. ft. rose 7.2%. The acceleration of ecommerce sales is bolstering the demand for industrial warehouses and distribution centers. 449.5 million sq. ft. is under construction, equivalent to 2.6% of current inventory. Cap Rates rose to 6.7% (7.1% in 2020 Q1). In NH the vacancy rate was 5.9% on an inventory of 42.6 million sq. ft. In the last 12 months there was 587,985 sq. ft. of leasing and minus 62,973 sq. ft. of absorption. Average asking rents increased 7.3% to $8.90/sq. ft. There are 327,318 sq. ft. under construction. Cap Rates average 5.7%.

Nationally in the Retail property market, 15.1 million sq. ft. became occupied compared to three months ago, with total net absorption of 47.1 million sq. ft. since 2020 Q2. The vacancy rate is at 4.7%. The average asking rent rose 2.5%. There are 50.1 million sq. ft. under construction, down from 60.8 million in 2020 Q1. This is just 0.4% of the inventory of retail space. Cap Rates dropped to 6.0%. In NH the vacancy rate was 2.5% on an inventory of 28.73 million sq. ft. In the last 12 months there was 131,639 sq. ft. of leasing and 405,498 sq. ft. of absorption.  Average asking rents increased .4% to $17.30/sq. ft.

Nationally, Multifamily asking rents continue to soar, rising to 11.4% year-over-year, a new high for rent growth. Occupancy increased by 101,223 units compared to three months ago, with a total increase in units occupied by 1.05 million units since 2020 Q2. The vacancy rate is at 4.6% (6.7% in 2020 Q1). As of 2021 Q3, there were 644,690 apartment units under construction, equivalent to 3.6% of the current inventory of apartment units. However, the level of units under construction is down from 719,272 units in 2020 Q1 (pre-pandemic). Cap Rates rose to 5.2%.

This information is from the National Association of Realtors (“NAR”) and their Chief Economist Lawrence Yun. The NAR includes the greater Nashua market as part of the Boston-Cambridge market. Overall, the Boston-Cambridge market is even stronger than NH.  More detailed information can be found on NAR’s website

Leave a Reply

Articles and comments do not necessarily reflect the opinions of NHCIBOR or its members. For detailed information regarding the terms of use of this website, please click here.