The industrial real estate market in Central Pennsylvania is unusual for various reasons. We’ve produced a list of what we believe are the most relevant data about our local industrial market, taking into account its geographic, demographic, and economic variables.
Suppose you’re a real estate investor or want to learn more about the commercial real estate market in Central Pennsylvania. In that case, you’ll find this list of top 10 facts both useful and entertaining. Let’s have a peek, shall we?
Office Space Demand is Changing
Regardless of the season, there is always a demand for reasonably priced office space. Many high-priced units remain on the market because there is a scarcity of good, reasonably priced property in the neighborhood.
Annual office sales volume levels in Central Pennsylvania declined for several years before rebounding in 2018, propelled in part by large government purchases.
However, the COVID-19 epidemic wreaked havoc on the local market. Many businesses have yet to reopen their doors, with staff continuing to work from home. Some leases aren’t being renewed, and individuals are looking for other places to live. Right present, people are more interested in sales.
1. The Harrisburg Area Rivals the Lehigh Valley
Even though the Lehigh Valley is often regarded as Pennsylvania’s warehousing and distribution leader, Harrisburg supplied only 600,000 SF less than Allentown, with nearly the same rent growth.
Additionally, large-scale warehouse and distribution centers have been established in Harrisburg by firms such as Whirlpool— and those tenants account for only a share of the more than 15 million SF of net absorption.
2. Harrisburg-Carlisle and Lancaster Among Top Job Creators
As of August 2017, Harrisburg-Carlisle and Lancaster were in the top 25 metro areas with the fastest job growth. Lancaster was ranked 24th for its consistent growth as it diversified its economy and renovated its downtown and industrial regions.
Lancaster added 3,100 new jobs in the last six months, bringing its total employment to 252,400 and a 1.23 per cent growth rate in 2017.
With 6,200 new jobs gained in the first two quarters of 2017, Harrisburg-Carlisle ranked eighth, bringing total employment to 346,100 and the 2017 growth rate to 1.82 per cent. A broad array of healthcare, technology, and biotechnology enterprises was noted.
3. Prime Warehouse and Distribution Site
For several compelling reasons, Central Pennsylvania is a prime market for industrial space. The location has a great transportation infrastructure, a plentiful workforce, relatively inexpensive and available raw land, and the capacity to reach 70 to 80 per cent of the US population in 24 hours for firms that need fast and affordable product storage and shipping.
Furthermore, when compared to other surrounding states or regions, our government rules on warehousing and distribution are rather straightforward.
4. Which State Has the Fastest Commercial Real Estate Growth?
The adage “everything is bigger in Texas” is accurate when it comes to commercial real estate development. According to CBRE research, Austin, TX, is the top commercial real estate growth market, closely followed by Dallas.
Strong population growth, a business-friendly environment, low taxes, high occupancy rates, and brisk leasing activity contribute to this. When these characteristics are combined, commercial real estate growth markets become quite appealing.
At a higher level, the overall pattern is that markets in the south and west (Miami, Orlando, Phoenix, Los Angeles, Nashville, San Francisco) are increasing, while those in the northeast and midwest (New York and Chicago) are slowing for the same reasons indicated above.
Warmer climates, more space, lower population, and various recreational activities are becoming increasingly popular among Americans.
5. Do Commercial Real Estate Prices Rise?
Commercial real estate appeals to investors because of its consistent cash flow, tax advantages, and long history of steady value growth. Commercial real estate values climbed at an annual pace of 1.3 per cent from April 2020 to April 2021, according to Real Capital Analytics – via million acres.
There are significant variances in this appreciation figure depending on the property type. Multifamily property owners, for example, had a 7.6% gain within the same period, while industrial buildings jumped by 9.4%, retail space increased by 1.3 per cent, and office space increased by 3%.
These numbers are noteworthy because they represent the first positive returns in the apartment, retail, office, and industrial sectors since the outbreak began.
6. Keep in Touch With Your Agent
Many of the transactions we facilitate are for properties that have never been on the market before. We match properties with persons we think may be interested in owning them, and sales can be completed without the property ever being publicly listed
. The sales process for such properties usually goes quickly, and both parties get what they want without spending money on marketing or other fees.
Keep in touch with your agent if you want to be the first to know about a terrific offer. They can inform you what’s available and what’s on the way, giving you a leg up on the competition. We get a lot of repeat business at SVN | Latus because people appreciate us looking out for them.