2012 Global Market report - NAI Global

Reno, Nevada
Manchester, New Hampshire
Contact
NAI Alliance
+1 775 336 4600
Metropolitan Area
Economic Overview
2011
Population
2016 Estimated
Population
Employment
Population
Household
Average Income
Median
Household Income
894,424
949,205
487,973
$72,127
$57,821
The Reno economy has traditionally been based on gaming
and tourism with warehousing and manufacturing as the
lead non-gaming industry. During good economic times,
Reno’s unemployment rate was below the national average.
It is now 13.4%. Overall activity in 2011 increased in office
and industrial with retail remaining stable compared to the
prior year’s numbers. With election year politicking and the
European debt issues, we anticipate a stable 2012 as
companies wait to see a clearer economic direction.
A slight increase in the vacancy rates of the Central Reno
and Airport submarkets was not deep enough to cut into the
overall positive quarters that the Reno/Sparks office market
experienced. If this trend in positive net absorption continues,
we should see a 2% drop in vacancy. These decreased
vacancy rates were the result of positive net absorption in
the South Meadows and Downtown submarkets, with
30,391 SF and 17,127 SF respectively. Until the office
market experiences several consecutive quarters of declining
vacancy, rental rates should stay relatively flat. A slight
decrease in rental rates could even be on the horizon in
some submarkets.
After an increase in Q1 vacancy, the industrial market
showed signs of hope as Q2 ended with strong numbers.
Reality hit with a disappointing Q3 and Q4 performance. The
number of deals was down, but more notably, the average
transaction size dropped by 38%. The good news is company
closures slowed, leading to a drop in new space being
vacated and enabling the quarter to end with positive net
absorption. This, combined with a strong Q2, led to a reduction
in vacancy over the past year from 15.1% to 14.6%.
Although market activity has taken a breather, the market
is still headed in the right direction, albeit slowly.
The retail market overall vacancy rate is 17.8%, up slightly
from 17.4% in mid-year 2010. Walmart is under construction
with a super store in Lemmon Valley expected to open in
Q4 2011. Lowes is under construction with a store in the
Legends at the Sparks Marina. Other new retailers to the
area include America’s Furniture 4 Less, Fitness for $10,
Planet Fitness, Famous Dave’s and Total Wine.
Contact
NAI Norwood Group
+1 603 668 7000
Metropolitan Area
Economic Overview
2011
Population
2016 Estimated
Population
Employment
Population
Household
Average Income
Median
Household Income
399,869
396,471
229,368
$88,834
$71,241
Why chose the “Live Free or Die” state? The first indicator is
the low tax burden, with no broad-base personal income tax,
sales, use, inventory or capital gains taxes. We continue to
lead the nation in economic recovery as the unemploymentrate
of 4.9% is at its lowest level since 2008, compared to
a national rate of more than 9%. New Hampshire has been
voted as the Most-Livable-State in the US for the last five
consecutive years.
Although the question of when the markets will see real
growth is elusive, the forecast for most markets in the
Manchester area is positive for the coming year as many
projects have been completed or will be completed within
the next year. While not improving, we have seen vacancy
rates remain flat. There is an amount of “shadow” vacancy
that will need to be absorbed as companies burn off leases
with larger square footages. To balance this, sectors of the
economy including small manufacturing, healthcare and
high-tech continue to grow. This has kept New Hampshire’s
unemployment rate low and the vacancy rates in line.
Phase I of the Northwest Business Park, a 425 acre
business/industrial park currently being developed in the
northwestern portion of Manchester is now being marketed.
This phase consists of 12 lots on 130 acres ranging from
2.8 to 26.3 acres. Approvals are in place for buildings
ranging in size from 20,000 to 150,000 SF. Also expected
to be completed in 2011 is a downtown Manchester,
120,000 SF Market Basket Store.
There is strong support from our state for the Capital Corridor
Commuter Rail. This would connect Concord with Boston and
has future plans for a high speed rail line connection from
Montreal to Boston. State agencies have received two grants
from the Federal Government totaling $4.3 million to study
and plan the Capital Corridor.
In Merrimack, New Hampshire, developers expect to have
the phase I of the Merrimack Premium Outlet Mall completed
by the summer of 2012. This $100 million project will include
100 retail stores and create over 800 jobs.
Total Population
Median Age
39
Total Population
Median Age
37
Reno At A Glance
(Rent/SF/YR) low High effective avg. Vacancy
doWntoWn offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
suburban offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
IndustrIal
$
$
$
$
N/A
19.80
12.00
N/A
19.80
12.00
N/A
$ 24.00
$ 19.40
N/A
$ 24.00
$ 17.40
N/A
$ 21.90
$ 14.70
N/A
$ 21.90
$ 14.70
N/A
18.00%
20.00%
N/A
17.00%
21.00%
Bulk Warehouse
Manufacturing
High Tech/R&D
retaIl
$
$
$
2.28
2.40
4.20
$
$
$
4.20
4.92
7.20
$
$
$
3.00
3.10
6.00
17.90%
12.10%
27.20%
Downtown
Neighborhood Service Centers
Sub Regional Centers
Regional Malls
$
$
$
10.80
9.60
12.00
N/A
$ 27.00
$ 24.00
$ 24.00
N/A
$ 18.00
$ 18.00
$ 20.40
N/A
N/A
15.00%
20.00%
N/A
deVeloPment land Low/Acre High/Acre
Office in CBD
$ 479,160.00 $ 1,437,480.00
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
Retail/Commercial Land
Residential
$
$
$
$
348,480.00
87,120.00
43,560.00
108,900.00
N/A
$
$
$
$
522,720.00
304,920.00
217,800.00
958,320.00
N/A
Manchester At A Glance
(Rent/SF/YR) low High effective avg. Vacancy
doWntoWn offIce
New Construction (AAA)
Class A (Prime)
NA
$ 13.00 $
NA
17.00
NA
$ 14.00
NA
20.00%
Class B (Secondary)
suburban offIce
New Construction (AAA)
$ 8.00
N/A
$ 13.00
N/A
$ 10.00
N/A
15.00%
N/A
Class A (Prime)
$ 12.00 $ 14.00 $ 13.00 15.00%
Class B (Secondary)
IndustrIal
$ 8.00 $ 13.00 $ 10.00 10.00%
Bulk Warehouse
Manufacturing
High Tech/R&D
retaIl
$
$
$
3.75
4.00
6.00
$
$
$
5.50
6.00
9.00
$
$
$
4.75
5.00
8.00
14.00%
14.00%
14.00%
Downtown
Neighborhood Service Centers
Community Power Center
Regional Malls
$ 10.00
$ 10.00
N/A
N/A
$
$
20.00
25.00
N/A
N/A
$ 13.00
$ 17.00
N/A
N/A
N/A
N/A
N/A
N/A
deVeloPment land Low/Acre High/Acre
Office in CBD
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
Retail/Commercial Land
Residential
$
$
$
N/A
N/A
N/A
75,000.00
125,000.00
75,000.00
$
$
$
N/A
N/A
N/A
100,000.00
200,000.00
200,000.00
2012 Global Market Report n www.naiglobal.com 113