- July 19, 2016
- Quarter Report
- 0 Comments
Market Trends & Commentary
Q1 & Q2, 2016 Sales
Northern Colorado Commercial Real Estate Report
for Boulder, Larimer, and Weld Counties.
A torrid start to the year sent sales volumes soaring. Investors have had high interest in multi-family properties in our growing region with three universities and several colleges. Investors from out of the area have also been interested in income-generating commercial properties, such as strip retail centers. Owner-users have been expanding facilities or building new facilities. Despite a slow-down in the energy industry, Industrial properties with good warehousing features (docks, high ceilings, ample site circulation room, etc.) have been in demand.
A Few Significant Regional Sales Transactions
Q1 2016 had the most high dollar activity thus far during the year. Several significant multi-family sales highlighted this activity. Pricing for multi-family may have reached, or is reaching a peak, and Sellers are taking advantage of the high investor interest in our region for this type of product. The large Scheel’s 26 acre retail development will change the landscape for the I-25 / Hwy 34 corridor by adding significant retail space.
Q1 & Q2, 2016 Lease Activity – Northern Colorado Commercial Real Estate Report; Boulder, Larimer, and Weld Counties
Leasing activity and absorption rates both look to surpass that of the previous five years. At current pace, approximately 8 million square feet of leasing activity will occur by years end, and 2 million square feet of absorption in an already tight supply market.
A Few Significant Regional Lease Transactions
From the Author: Summary / Market Trends:
- The strong sales momentum from the last half of 2015 has continued into the first half of 2016. Sales transaction volume will no doubt set a five year high this year, and probably do so during the third quarter of the year. Outside of area investors continue to seek multi-family and other investment grade properties in northern Colorado. These investors are paying higher prices than anytime during the last five years, enticing even short term owners to re-trade their properties for quick profit taking.
- Leasing activity has got a boost from deliveries of new buildings to the market. Many local and regional businesses are expanding, and are absorbing all the new space being delivered to the market. Sublet space has increased in some industrial space heretofore occupied by the slumping energy industry, but this is limited to service oriented light industrial. Warehousing and distribution space continues to be in short supply and high demand. Flex property also is being absorbed, in some cases turning into full office use despite their flex configuration.
- Land development has been buoyed by home-building activity, which still lags the historic highs before the last recession. The growing population and latent demand driving residential growth has encouraged long dormant sites to be revived, subdivided, and developed into residential lots or apartment sites. The Scheels 26 acre 25/34 project will add to the area’s retail growth and bring a new significant retail store to the area. Windsor and northern CO will be benefiting from planned recreational development from the recent tourism grant of state lotto funds.