Office Submarket Reports

Q1 2022

OVERVIEW

Th Northeast/I-77 submarket covers a sprawling geography from urban North Charlotte, to not yet developed communities and land tracts which border the eastern rim of Lake Norman. It consists of 6 million sf of office inventory, largely comprised of medical offices and flex business parks in addition to a more modest percentage of core (Class A and B) multi-tenant product. Significant population growth, driven by national demographic and migration trends have attracted health care operations, corporate headquarters and projects to continue its steady growth.

DATA, TRENDS AND CONSIDERATIONS

Vacancies in the area have risen after soft demand through the COVID-19 pandemic, though still below the 8.5% avg. seen across the Charlotte metro area. There has been a lack of significant new construction outside of the Health Care space. Not surprisingly rental growth has remained slow, as the 2.1% growth closely mirrors Charlotte metro. With an average rental rate of $27.00 psf, Northeast I-77 presents the type of value one would expect to see in this suburban submarket. Roughly $128 million worth of capital markets transactions closed last year and notably Harris Corners Corporate Park for $78 million and $218 psf.