Market Insights Commercial Real Estate Agents

Colliers | Memphis

Brokerage Services
6000 Poplar Avenue
Suite 201
Memphis, Tennessee 38119 
USA
Main: +1 901 375 4800
Fax: +1 901 375 9600

Andy Cates, SIOR
CEO & President of Brokerage Services | Memphis
andy.cates@colliers.com

Asset Services
6363 Poplar Avenue
Suite 400
Memphis, Tennessee 38119
USA
Main: +1 901 375 4800
Fax: +1 901 312 5750

Brad Kornegay
President | Memphis - Asset Services
brad.kornegay@colliers.com

 

 

 

 

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Recent Reports | Memphis

Q1 2017 | Memphis Industrial Market Report

After ten straight quarters of positive absorption, the Memphis Industrial market experienced negative absorption in Q1. However, the negative absorption was caused by TBC Corp’s multi-quarter move from the Southeast submarket to Fayette County. The company moved into approximately 1.5 million square feet at Gateway Global Logistics Center in Q4 2016, but they did not vacate their 471,744 square foot space in Hickory Hill until Q1 2017. More than 1.4 million square feet of new construction was delivered in Q1. Almost 75% of the new construction is leased, and greater than half of it is speculative. The construction momentum will continue this year, with approximately 4 million square feet of additional construction scheduled to commence in Q2.

Q4 2016 | Memphis Office Market Report

In Q4, the 385 Corridor led positive activity in the Memphis office market, with approximately 50% of the leased square footage located in the submarket. Between the leases signed for 26,424 square feet by FedEx, 14,133 square feet by Towers Watson and several smaller spaces by tenants ranging from law offices to financial and healthcare services, it was the best quarter for the submarket since Q1 2015.

Q4 2016| Memphis Industrial Market Report

While leasing activity was slow in Q4, two Class A warehouses totaling more than 2 million square feet were delivered at Panattoni’s Gateway Global Logistics Center in Fayette County and Marshall County. The two buildings—one 100% preleased and the other purchased by the user before construction completion—accounted for the majority of the total market absorption in Q4. In Q4, Gramercy Property Trust purchased a 17-property, 10.3 million square foot portfolio of Class A warehouse space located in key logistics markets throughout the US.

Q3 2016 | Memphis Office Market Report

While the Memphis office market experienced negative absorption in Q3, several promising signs of future positive activity have been reported. Pinnacle Financial Partners is relocating to 33,312 square feet at Boyle Investment Co’s new Class A office building at 949 Shady Grove Road in East Memphis with intentions of future growth. In addition, Mid-America Apartment Communities, Inc is expanding their footprint from 43,000 square feet at their current headquarters to 83,265 square feet Gill Properties’ new mixed-use TraVure Development in Germantown.

Q3 2016 | Memphis Industrial Market Report

With more than 13.5 million square feet of net absorption in the last six quarters and only 4.3 million square feet of construction deliveries, the Memphis MSA industrial
market is experiencing near all-time low vacancy levels and available property inventory levels.

Q2 2016 | Memphis Industrial Market Report

The Memphis industrial market experienced 1.1 million square feet of positive net absorption in Q2, bringing the year-to-date net absorption for the Memphis MSA to more than 3.5 million square feet. Leasing activity remained steady, with several new deals of 100,000+ square feet signed and total market leasing activity of approximately 3.2 million square feet.

Q1 2016 | Memphis Industrial Market Report

While the Memphis industrial market experienced almost 1.7 million square feet of positive absorption in Q1, perhaps the most significant story of the quarter was the delivery of approximately 1.86 million square feet of new inventory. All but 77,000 square feet of the completed construction is located in Desoto County, with more than 1 million square feet of Class A warehouse space delivered at Hillwood’s Legacy Park.

Q1 2016 | Memphis Office Market Report

While leasing activity in the Memphis office market was healthy in Q1, the market experienced a negative net absorption for the quarter. Future occupancy dates for Q1 transactions and a handful of sizable vacancies in the 385 Corridor, Downtown and Midtown submarkets were the primary drivers of a Q1 total market net absorption of -51,642 square feet.

Q4 2015 | Memphis Industrial Market Report

While the market experienced an expected Q4 decrease in leasing activity, 2015 ended on a high note — with a year-to-date total market positive net absorption of more than 7.7 million square feet. Greater than 2.5 million square feet of build-to-suit and speculative construction was delivered in 2015, and another 400,000 square feet of build-to-suit and 1.9 million square feet of speculative product is currently under construction.

Q4 2015 | Memphis Office Market Report

In Q4, five leases greater than 10,000 square feet each were signed in the Memphis MSA. Unlike the first three quarters of 2015, which were driven largely by leasing activity concentrated in the East submarket, Q4 sizable leases were signed in five different submarkets. With less than 4% vacancy among Class A properties in the East submarket, tenants with greater than 10,000 square foot requirements are considering secondary submarkets.

Q3 2015 | Memphis Industrial Market Report

Overall, the Memphis MSA has approximately 6 million square feet of available Class A space, a five-year low that is expected to continue to trend down. The primary question for the Memphis industrial market’s future is whether the tightening availability of Class A space will motivate additional developers to build new speculative Class A buildings or invest funds into existing Class B properties.

Q3 2015 | Memphis Office Market Report

East Memphis properties continue to be the primary driver of activity in the Memphis office market. As predicted in the Q1 report, tightening availability among East Class A properties has resulted in Q3 positive net absorption among East Class B properties. The two largest leases of the quarter, totaling almost 71,000 square feet, were both signed in East Class B properties.

Q1 2015 | Memphis Industrial Market Report

Activity in the Southeast and Desoto County submarkets remain the most significant drivers of the performance of the total Memphis industrial market. Vacancy at four properties in Desoto County accounted for almost one million square feet of negative absorption, tempering the positive activity in the total Memphis market. Positive absorption in the Southeast of more than 900,000 square feet was due in large part to the occupancy of Target at Memphis Industrial Park, Anixter at Memphis Distribution Center and FedEx at Summit III. With four notable leases signed in the first quarter that range from 200,000 square feet to 618,000 square feet, the Southeast should push the market’s future absorption numbers upward throughout 2015.

Q1 2015 | Memphis Office Market Report

East Memphis properties continue to be the primary driver of activity in the Memphis office market. The delivery of and occupancy by International Paper at International Place IV accounted for almost 250,000 square feet of the market’s total net absorption. Positive gross absorption of a little more than 22,000 square feet downtown was not enough to offset large vacancies at Raymond James Tower, One Memphis Place and Union Center. Coupled with a handful of smaller move-outs, the vacancies resulted in a negative net absorption for the central business district.

Q4 2014 | Memphis Industrial Market Report

The Memphis Industrial Market ended 2014 with almost 224 million square feet, including 216 million square feet of warehouse space and 7.8 million in flex space. 2.6 million square feet in new construction deliveries in 2014 more than accounted for just over 1.8 million square feet in net absorption for the year. While total net absorption for 2014 was relatively low, an additional 1.4 million square feet of leases were signed in the fourth quarter that will commence in future quarters, continuing to positively affect the market’s absorption numbers.

Q4 2014 | Memphis Office Market Report

The total Memphis office market ended Q4 2014 at just over 32.7 million square feet, including nearly 27.3 million square feet in suburban submarkets and over 5.4 million in the Central Business District (CBD). Total office vacancy rates ended 2014 at 14.5%, down fairly significantly from a year-end 2013 rate of 15.8%. Positive net absorption of 129,662 square feet in Q4 of 2014 brought the year’s total net absorption to 439,420 square feet. The East Submarket and the Central Business District were major contributors, with positive net absorption for the year of 292,346 square feet and 168,938 square feet, respectively.

Q3 2014 | Memphis Industrial Market Report

While 2013 was a pretty robust year for industrial real estate in the market, we’ve hit a plateau of sorts in 2014. At the end of Q3 2014, the Memphis Metro included nearly 223 million square feet of industrial space, with 214.7 million square feet in warehouse space and nearly 8 million in flex space. Overall asking rental rate increased just slightly from $2.63 as of the end of Q2 2014 to $2.63 as of the end of Q3 and vacancy remained steady at 12.6%.

Q3 2014 | Memphis Office Market Report

The total Memphis office market ended Q3 2014 at just over 32.6 million square feet, including 27.2 million square feet in suburban submarkets and almost 5.4 million in the Central Business District (CBD). Total office vacancy rates ended Q3 2014 at 14.8%, a slight increase from Q2 2014’s 14.6% but still a full percentage point lower than where we ended 2013.

Q2 2014 | Memphis Industrial Market Report

At the end of Q2 2014, the Memphis Metro included just over 222 million square feet of industrial space, with 214.3 million square feet in warehouse space and nearly 8 million in flex space. Overall asking rental rate increased just slightly from $2.61 as of the end of Q1 2014 to $2.62 as of the end of Q2. Likewise, vacancy rates changed very little, inching up from 12% at the end of Q1 to 12.1% at the end of Q2.

Q2 2014 | Memphis Office Market Report

The total Memphis office market ended Q2 2014 at just over 32.6 million square feet, including 27.2 million square feet in suburban submarkets and almost 5.4 million in the Central Business District (CBD). Total office vacancy rates ended Q2 2014 at 14.6%, a decrease from Q1 2014’s 15.4% and the lowest the market has seen since Q3 of 2010.

Q1 2014 | Memphis Industrial Market Report

At the end of Q1 2014, the Memphis Metro included just over 222 million square feet of industrial space, with 214.3 million square feet in warehouse space and nearly 8 million in flex space. Overall asking rental rate increased from $2.54 as of the end of Q4 2013 to $2.61.

Q1 2014 | Memphis Office Market Report

The total Memphis office market ended Q1 2014 at just over 33 million square feet, including 27 million square feet in suburban submarkets and almost 6 million in the Central Business District (CBD). Total office vacancy rates ended Q1 2014 at 15.4%, a decrease from year-end 2013’s 15.7%.

Q4 2013 | Memphis Industrial Market Report

At the end of Q4 2013, the Memphis Metro included just over 221 million square feet of industrial space, with 213.6 million square feet in warehouse space and nearly 8 million in flex space. After dropping for two quarters, the overall asking rental rate increased slightly to $2.54, not significantly different from the $2.57 year-end 2012 average rate.

Q4 2013 | Memphis Office Market Report

The total Memphis office market ended Q4 2013 at just over 33 million square feet, including 27 million square feet in suburban submarkets and 6 million in the Central Business District (CBD). Total office vacancy rates ended Q4 at 15.7%, down slightly from 15.8% at the end of Q3 2013.

Q3 2013 | Memphis Office Market Report

The total Memphis office market ended Q3 2013 at almost 33 million square feet, including almost 27 million square feet in suburban submarkets and just over 6 million in the Central Business District (CBD). Total office vacancy rates ended the third quarter at 15.9%, up slightly from 15.7% at the end of Q2 2013.

Q3 2013 | Memphis Industrial Market Report

At the end of Q3 2013, the Memphis Metro included nearly 220 million square feet of industrial space, with almost 212 million square feet in warehouse space and nearly 8 million in flex space. The Memphis Metro industrial market has had four straight quarters of positive net absorption.

Q2 2013 | Memphis Industrial Market Report

After two quarters of net absorption totaling over 4 million square feet, the Memphis Metro industrial market experienced a moderately flat Q2 2013, with 326,619 square feet in positive absorption and a minor drop in overall vacancy rates from 12.6% in Q1 2013 to 12.5% as of the end of Q2. Weighted average rental rates were down from $2.60 at the end of Q1 to $2.53 as of the end of Q2 2013.

Q2 2013 | Memphis Office Market Report

The total Memphis office market ended Q2 2013 at just over 33.5 million square feet, including 27.5 million square feet in suburban submarkets and just over 6 million in the central business district (CBD). Total office vacancy rates ended the second quarter at 15.3%, up from 15% at the end of Q1 2013. On the other hand, average asking rental rates have been on the increase, moving from $15.03 at year-end 2012 to $15.99 as of the end of Q2 2013. This is the result of higher demand for certain submarkets where rates well exceed the overall average, and not an indication of material improvement in the overall market.

Q1 2013 Industrial Report

The Memphis Metro had nearly 1.7 million square feet of positive absorption in Q1 2013, following over 2.6 million square feet of positive absorption in Q4 2012.

Q1 2013 Office Report

The total Memphis office market ended Q1 2013 at approximately 33.5 million square feet, including 27.4 million square feet in suburban submarkets and 6.1 million square feet in the CBD.

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Memphis
6000 Poplar Avenue, Suite 201 Memphis, TN 38119 United States | Tel: +1 901 375 4800