Quarter 1 of 2020 got off to a very strong start in the office market, until the COVID crisis hit the world mid-March. Before COVID, we signed numerous leases through-out the valley ranging in all sizes with continued strong activity of tenants over 15,000 SF. The majority of the leasing has been at Eagle and Overland and 10-Mile. Downtown also had very good activity in Q1 - 2020.
While experienced commercial real estate professionals have been expecting an economic correction in Idaho for some time, nobody could have predicted a pandemic to finally affect our economic growth. Idaho is fortunate in that it had very strong fundamentals before the impacts of the pandemic were felt and experts predict a quick rebound once businesses are allowed to reopen.
Cushman & Wakefield MarketBeat reports analyze quarterly commercial real estate activity, including supply, demand and pricing trends.
Access first quarter 2020 commercial real estate results for the office, industrial and retail sectors
• Leasing activity was stable in 2019, at roughly the same volume as in 2018.
• The West region exhibited the strongest leasing activity, with more than 100 million square feet leased for a fourth consecutive year.
• The tech industry once again dominated leasing activity, accounting for 27.6% of the major leases—up from 26.1% in 2018. Tech leasing totaled slightly less than leasing for the financial services, government and real estate combined.
• For a second consecutive year there were more than 25 large leases (over 400,000 sf) signed in 2019.
The U.S. economy ended the year on an optimistic note. Businesses continued to add jobs at a healthy clip. Employment in the key office-using sectors increased by 150,000 jobs in the fourth quarter. Consumer confidence remains high. Wages are rising faster than inflation, yielding extra spending power, reflected in the 18.8% increase in online shopping over the holiday season.
Overall transaction activity for investments accelerated modestly in the fourth quarter of 2019 to $152.2 billion—up 2% quarter-over-quarter (QoQ). Single asset sales drove the increase, notably deals over $250 million, which rose 35% QoQ and 30% year-over-year. For multifamily, the average annual effective rent growth in the U.S. in 2019 was 2.8%, down 80 basis points from the 2018 average. Rent growth moderation at this mature stage of the cycle is a positive indicator of the health of the multifamily sector.
The forecast for North American industrial absorption in 2020-2021 is a healthy 459.9 msf. Economic indicators, with strong links to industrial fundamentals, point to continued growth in 2020 and 2021. Industrial has been the investors’ darling in recent years, and there is no indication of this love affair coming to an end any time soon. Over the next couple of years, we expect it to remain one of the leading product types to watch
The U.S. economy ended the year on an optimistic note. Businesses continued to add jobs at a healthy clip. Employment in the key office-using sectors increased by 150,000 jobs in the fourth quarter. Consumer confidence remains high. Wages are rising faster than inflation, yielding extra spending power, reflected in the 18.8% increase in online shopping over the holiday season. The industrial market finished strong absorbing 68.8 msf in the Q4, the most space in a single quarter last year.