Q1 2020 Ended with Significant Market Disruption Due to COVID-19; Record Sales & Low Vacancy Likely Peaked this Quarter
- Q1 2020 kicked off with a string of new office developments being announced as continued renovations to current office buildings throughout the Charlotte market. One of the proposed office developments of note was Stiles Corporation’s and Shorenstein Properties’ 23-story, 370,000 square foot office tower.
- Beacon Partners recently announced it would double the projected size of their new mixed used development at LoSo Station to over 1 Million square feet of office and retail space. Beacon plans to begin the development by breaking ground on a 5-story, 80,000 square foot office building in Q1 2021.
- Currently there is still a large amount of office buildings under construction across Charlotte, totaling 5.3 Million square feet, most of which remain in the Urban markets such as CBD, South End and Midtown.
- On the last day of Q1 2020, a new single building sale record was set by Truist Financial Corporation’s acquisition of Truist Center located at 214 N. Tryon Street in Charlotte’s CBD for $455.5 Million or $472 per square foot. Truist will occupy 561,000 square feet of the 47-story building.
- After a strong performance in Q4 2019, leasing activity slowed significantly in late Q1 2020 due to the impacts of COVID-19. We expect the pandemic impacts to continue to negatively impact the market throughout at least the next quarter - the depth of the impact will depend on how soon everyone can get back out and actively use real estate again to generate revenue.
|Q1 2020 Charlotte Industrial Market||Overall||Class A|
|Absorption||156,637 SF||518,244 SF|
|Under Construction||5,347,960 SF||4,831,988 SF|
|Downtown||$36.13 PSF||$39.71 PSF|
|Suburban||$28.89 PSF||$32.79 PSF|
A Note Regarding COVID-19 - As we publish this report, the U.S. and the world at large are facing a tremendous challenge, the scale of which is unprecedented in recent history. The spread of the novel coronavirus (COVID-19) is significantly altering day-today life, impacting society, the economy and, by extension, commercial real estate. The extent, length and severity of this pandemic is unknown and continues to evolve at a rapid pace. The scale of the impact and its timing varies between locations. To better understand trends and emerging adjustments, please subscribe to Colliers’ COVID-19 Knowledge Leader page for resources and recent updates.