North Carolina’s Investment Prospects

Although the country’s economy as a whole is expected to slow over the next year, cities in secondary markets like North Carolina’s Raleigh and Charlotte are still on the rise. Investors are looking to these smaller cities for their strong economic gains and the potential for upside growth on a variety of commercial real estate investments. Office and multifamily assets are traditionally go-to property types for investors in these regions, but Raleigh in particular is continuing to expand its retail market.

Raleigh’s Meteoric Rise

By the end of 2019, Raleigh’s retail market reported increased rental prices of more than seven percent, making the city the highest rent growth area in the United States. The city’s retail market is driven by several factors, including its strong population growth, high wages, educated workforce and exceptional job market. The capital city boasts some of the highest median household incomes in the region, placing Raleigh just behind Austin, Texas as the second wealthiest city in the South.

Raleigh’s Retail Landscape

The suburban markets in Raleigh are experiencing just as much growth as the city’s downtown center as younger workers flock to areas on the outskirts of the urban core. Several large-scale multi-use developments will serve these areas and bring more than 470,000 feet of retail space to Raleigh in the coming years. One of the newest projects of this kind is an adaptive-reuse project that will transform old steel mills and warehouses into a collection of offices, shops and apartments.

Breaking Ground on Raleigh Iron Works

Situated northeast of downtown Raleigh near the Mordecai and Five Points neighborhoods lies the future site of Raleigh Iron Works. This multi-phase mixed-use project will preserve a portion of the city’s industrial past by repurposing former warehouses and steel mills from the ground up. Adaptive-reuse projects of this nature are gaining in popularity within the Raleigh market because they fit in well with the area’s thriving, innovative culture. The project’s $150 million first phase will contain 500,000 square feet of creative office space, 90,000 square feet of retail space and at least 220 residential units.

Interested in investing in North Carolina commercial real estate? Ground + Space is a leading commercial real estate brokerage firm based in North Carolina that specializes in single-tenant and retail NNN investmentsContact us today to find out more about our current listings or sign up for our mailing list to stay in-the-know on all that North Carolina has to offer.


Raleigh-Durham Industrial News

The Raleigh-Durham industrial market is currently posting some of the nation’s strongest fundamentals. In fact, this research-focused part of the state is growing faster than some major U.S. cities. As of the third financial quarter of 2019, just 1.7 percent of the industrial space in Raleigh is empty—a far lower rate than the five percent national average.

The Urban Land Institute ranked the Triangle No. 2 on its list of U.S. markets to watch for overall real estate prospects in 2020, and it’s easy to see why: steadily increasing asset values are drawing strong investor interest to the Triangle market. In fact, during the third financial quarter of 2019, industrial sales in the Triangle soared to $578 million.

Approximately one million square feet of space was delivered within the past 12 months, nearly all of which has been spoken for. Overall vacancy rates fell to just over four percent, while warehouse and distribution space vacancy rates dropped to a record low of 3.2 percent. Increasing demand for space from tenants has led to several new speculative projects throughout the Triangle region.

Industrial Market Highlights

Eastgate 540: A Charlotte-based development and investment firm recently broke ground on what will eventually become a 280,000-square-foot industrial building located within Eastgate 540. This 30-acre industrial park in a suburb just west of Raleigh was sold for $14.3 million in May 2019. All in all, a total of one million square feet of industrial space is slated for development at Eastgate 540.

Greenfield North 1201: A national developer has begun construction on a 165,291-square-foot speculative industrial warehouse in Garner, a suburb of Raleigh. Dubbed Greenfield North 1201, the property will make for a welcome addition to Greenfield North Business Park (currently 100 percent leased). Construction is scheduled to finish in July 2020.

Garner Business Park 70: Construction has begun on Garner Business Park 70, a four-building 625,000-square-foot industrial park off U.S. 70. A Cincinnati-based real estate firm plans to open the first of four buildings on the 50-acre industrial park campus in mid-2020. The property’s access to a major thoroughfare and proximity to the state capitol make it a prime location for warehouses, distribution centers and other industrial uses.

Interested in investing in North Carolina commercial real estate? Ground + Space is a leading commercial real estate brokerage firm based in North Carolina that specializes in single-tenant and retail NNN investmentsContact us today to find out more about our current listings or sign up for our mailing list to stay in-the-know on all that North Carolina has to offer.


Residential Developments on the Rise

The city of Raleigh has the third-highest apartment growth in the United States, and the surrounding area has been a hotbed of investment and development activity in recent months. Greater Raleigh’s strong, steady population and job growth have led to an equally strong demand for new rental properties.

Raleigh

An already booming area of Raleigh, North Carolina will see continued growth if a proposed apartment complex is approved by the city. A Charleston-based developer plans to build a five-story apartment complex across from Crabtree Valley Mall. Named Crabtree North Apartments, the community will feature more than 150 units across 303,000 square feet, along with a 253-space parking deck.

What else is happening in Raleigh? The eastern part of the state capitol might soon be home to a new mixed-use development with a focus on residential units. If the city approves a rezoning request for a 55.99-acre parcel along Raleigh Beach Road, the previously undeveloped area will be split into three separate parcels. Each parcel will feature a mix of residential and non-residential properties. Developers anticipate a mix of around 600 single-family, attached and multi-family residences complemented by 200,000 square feet of retail, restaurant, office and recreational space.

Cary

Investors and developers alike are placing bets on the ever-growing city of Cary, North Carolina. In early August 2019, a Virginia-based real estate firm acquired an amenity-abundant residential community in Cary for $119 million. This sale represents the largest single-property apartment transaction in the area to date. The community—known as The Aster—features a plentiful mix of apartments and townhomes, along with numerous luxury amenities including a golf simulator, a pet parlor, an expansive wellness center and more. The community is ideally positioned between the Research Triangle Park area and Raleigh-Durham International Airport.

Another major project on the horizon for Cary is the redevelopment of the 87-acre Cary Towne Center property at the heart of the city. The struggling mall will get more than just a facelift. The new owners of the property plan to turn the site into a full-fledged mixed-use destination. Current plans would transform the two-story shopping mall into a luxury mixed-use center with a mix of retail and office space, townhomes, hotels and more.

Brier Creek

The growing demand for senior housing can be felt within the Triangle market. Cambridge Village Optimal Living has taken advantage of the recent boom in the seniors housing sector and just broke ground on its newest project: an $80 million senior living facility in Brier Creek. The Cambridge at Brier Creek is scheduled to open in 2021 and will feature 205 apartments along with health and wellness facilities, medical amenities, a pub, a salon and much more. Residents of The Cambridge will have access to fitness trainers, outdoor activities and social events. The community is conveniently situated across the street from WakeMed’s Brier Creek Emergency Care Unit.

Interested in investing in North Carolina commercial real estate? Ground + Space is a leading commercial real estate brokerage firm based in North Carolina that specializes in single-tenant and retail NNN investments. Contact us today to find out more about our current listings or sign up for our mailing list to stay in-the-know on all that North Carolina has to offer.