2012 Global Market report - NAI Global

Raleigh/Durham, North Carolina
Fargo, North Dakota
Contact
NAI Carolantic Realty
+1 919 832 0594
Metropolitan Area
Economic Overview
2011
Population
2016 Estimated
Population
Employment
Population
Household
Average Income
Median
Household Income
Total Population
Median Age
1,928,033
2,155,657
1,019,281
$61,323
$46,941
36
Based on several metrics, Raleigh was ranked number one
in Businessweek.com’s first Best Cities ranking. It is no
surprise considering the region is home to three major
universities; North Carolina State University, Duke University
and the University of North Carolina at Chapel Hill. Also
helping the area get high marks is The Research Triangle
Park, one of the most successful R&D centers in the
world featuring microelectronics, environmental sciences,
pharmaceuticals and biotechnology companies.
The local office market experienced a slight decrease in
office vacancy at the end of the Q3 2011 with 15% for
suburban Class A, down from 17%; and 24% for suburban
Class B, down from 25%. Net absorption totaled 100,000+
SF over the past 12 months and rental rates remained flat.
Approximately 133,000 SF of office space was under
construction at the end of the Q3 2011. The largest office
sales transaction was Fidelity Investments’ purchase of four
office buildings in The Research Triangle Park. Fidelity paid
$34.3 million for the buildings in late September. LED
lighting company Cree bought another office building near
its Durham headquarters, a 59,902 SF building for $3.65
million.
In the industrial market, vacancy dropped slightly from the
previous quarter to a rate of 21%. Net absorption was down
in the warehouse category, but the flex market had
175,000 SF absorbed over a twelve month period. Rental
rates remained in the $4 to $10 range depending on
product type. No new construction is underway at the end
of Q3 2011. In the flex market, 11 buildings in Keystone
Technology Park were sold to The Lionstone Group for
$88.8 million. In September, Duke Realty paid just under
$31 million for four industrial warehouses and two flex
office buildings totaling 371,600 SF, and 66 acres of land.
The retail market had a slight increase in vacancy to 9%
with positive absorption over 12 months of 60,000 SF.
Despite two store closings (a Kmart and a Kroger store),
several new tenants expanded at The Streets at Southpoint
Mall in Durham. In addition, a 360,000+ SF shopping
center was opened this fall in Cary anchored by a Target
and buybuyBaby. Rental rates in the market dropped
slightly.
Contact
NAI North Central
+1 701 364 0244
Metropolitan Area
Economic Overview
2011
Population
2016 Estimated
Population
Employment
Population
Household
Average Income
Median
Household Income
Total Population
Median Age
216,073
245,226
129,087
$64,707
$48,706
31
Fargo-Moorhead remains a vibrant population center as well
as a key transportation hub in the upper Midwest. Fargo-
Moorhead’s economic outlook is promising. Both the labor
and education are here to sustain future business growth as
the population approaches, and soon exceeds, 200,000. This
includes more than 26,000 college students enrolled in three
major colleges. The Fargo-Moorhead population epitomizes
the Midwestern values of hard work, honesty, integrity and
something we call “Minnesota-North Dakota Nice.”
Fargo-Moorhead’s business climate enjoys consistent
growth through world class education, research, unique
advanced facilities, strong industry-university partnerships,
sophisticated business infrastructure and skilled and
productive employees. Our companies are competing
globally and profiting in a community that is fully engaged
in deliberate, cooperative and business focused planning
and execution.
The regional agricultural and agribusiness base is solid.
Producers-growers throughout the Red River Valley have
realized near record yields and revenues for the last several
years. Companies such as Amity Technology, Bobcat and
Case IH continue to make in-roads into export markets. Labor
negotiations have made recent news between American
Crystal Sugar and its labor union(s).
Fargo-Moorhead is a major transportation center for regional,
national and international shipping. Major trucking concerns,
such as Magnum and Valley Express, maintain operations
here. Cross-dock facilities are also available. Agricultural
commodities and manufactured goods are distributed
worldwide by rail, truck and air. Hector International Airport
allows for air freight to overseas markets and BNSF Railway
maintains an intermodal center in Dilworth, MN.
Health care continues to expand with Sanford Health. It is
expected Sanford Health will soon break ground at a new
campus after consolidating its merger with Meritcare. This
new project will enhance real estate values in south Fargo
while adding jobs to the health care industry.
Special mention is given this year to the energy boom taking
place in the Bakken Oil Field of western North Dakota. The
tremendous growth taking place in this region will have a
direct impact on businesses of all types serving the energy
sector. Fargo-Moorhead will realize benefits as the drive to
develop this resource progresses in the years ahead.
Raleigh/Durham 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
$
$
$
$
$
$
25.00
19.00
15.00
22.00
18.00
12.00
$ 28.95
$ 25.00
$ 18.00
$ 30.00
$ 24.00
$ 16.50
$ 26.98
$ 22.00
$ 16.50
$ 26.00
$ 21.00
$ 14.25
N/A
6.00%
16.00%
N/A
15.00%
25.00%
Bulk Warehouse
Manufacturing
$
$
2.50
3.00
$
$
5.00
5.00
$
$
3.75
4.00
21.00%
21.00%
High Tech/R&D
retaIl
$ 6.50 $ 10.00 $ 7.50 17.00%
Downtown
Neighborhood Service Centers
Community Power Center
Regional Malls
$
$
$
$
8.00
8.50
14.00
21.00
$ 21.00
$ 14.00
$ 22.00
$ 45.00
$ 14.50
$ 11.25
$ 18.00
$ 33.00
9.00%
9.00%
9.00%
9.00%
deVeloPment land Low/Acre High/Acre
Office in CBD
$ 2,178,000.00 $ 3,920,400.00
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
Retail/Commercial Land
Residential
$
$
$
$
$
135,000.00
75,000.00
60,000.00
152,460.00
12,500.00
$
$
$
$
$
200,000.00
150,000.00
200,000.00
750,000.00
75,000.00
Fargo At A Glance
(Rent/SF/YR) low High effective avg. Vacancy
doWntoWn offIce
New Construction (AAA)
$ 14.00 $ 20.00 $ 18.00 14.00%
Class A (Prime)
$ 9.50 $ 16.00 $ 14.50 8.50%
Class B (Secondary)
suburban offIce
$ 7.50 $ 10.00 $ 9.00 8.00%
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
IndustrIal
$ 14.00
$ 12.00
$ 10.00
$ 16.00
$ 16.00
$ 12.00
$ 16.00
$ 14.00
$ 10.00
10.00%
7.00%
8.00%
Bulk Warehouse
Manufacturing
$
$
4.40
4.75
$
$
6.25
7.00
$
$
5.40
6.50
8.50%
7.00%
High Tech/R&D
retaIl
Downtown
$
$
9.50
9.00
$ 16.00
$ 16.00
$ 14.50
$ 14.50
N/A
11.50%
Neighborhood Service Centers $ 10.50 $ 12.50 $ 11.00 12.00%
Sub Regional Centers
$ 8.00 $ 10.00 $ 8.00 11.00%
Regional Malls
$ 15.00 $ 20.00 $ 18.00 2.00%
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
$
$
$
$
$
$
370,260.00
78,408.00
65,340.00
76,230.00
156,816.00
20,910.00
$
$
$
$
$
$
662,112.00
152,460.00
98,010.00
126,324.00
235,224.00
55,539.00
2012 Global Market Report n www.naiglobal.com 122