Commercial Real Estate: Industrial rules the roost among property types in the South, Situs RERC survey respondents say

The industrial sector rated highest among all property types in the South region of the US for its value vs. price, while the apartment sector fared the worst. From a value vs. price perspective, the industrial sector was the most underpriced in the South, compared to all other regions. Industrial also ranked the highest among property types from a return vs. risk perspective, while retail trailed every other property type. That’s according to a survey of regional correspondents conducted for the 4Q 2018 Situs RERC Real Estate Report, “Staying on Track.”

Here’s a closer look at some of the major metro areas in the South:

ATLANTA
Atlanta added 61,684 jobs in 2018. The metro’s employment grew 2.2% over the last 12 months. At 3.3%, unemployment for the metro is below the national average of 3.9%.

Though no official announcements have been made regarding layoffs or branch closures, the recent merger between Atlanta-based SunTrust and North Carolina-based BB&T may impact Atlanta’s business and economic prospects.

AUSTIN
Austin’s employment grew 3.2% over the last 12 months, adding 34,038 jobs in 2018. At 2.9%, unemployment is below the national average of 3.9%.

Austin has become one of the top destinations for CRE investment in recent years due to its thriving local economy and relatively low cost of living.

HOUSTON
Houston’s economy relies heavily on the oil industry. In 2018, the metro’s employment grew 3.8%, adding 115,457 jobs in 2018. At 4%, unemployment is above the national average of 3.9%.

Houston has designated 150 areas as opportunity zones, which should help to densify Houston downtown through residential expansion. Construction has begun downtown on The Preston, a 373-unit luxury tower that will be funded by a Qualified Opportunity Zone fund.

In past weeks in Newswatch, we looked at the West and Midwest regions of the US. Next week, we’ll look at the Situs RERC survey results for the East region of the US.

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