Tri-Cities Market Update: January 2021
We are in the final days of 2020 and I am using this time to be grateful for what this year has taught me. I hope you’ll join me.
Heading into December, I expected market activity to be about getting deals across the finish line but that's not the case. There are new projects launching from ground-up development to off-market deals under contract. Here is your local market briefing:
- Transactions across WA reached 2019 levels for the first time since March. It appears the market is moving at full speed again; expect to see activity continue heading into 2021.
- As we look to a new year, what are your indicators for market health? Population, income, employment, vacancy, absorption, lease rates? In a recent article, I argue that the public sector's investments could provide an indicator of where local and market-level growth are headed in the years to come. Read the full post here.
- Nationally, rent payments through December 6 fell to the lowest level of 2020 and took the largest dip year over year. In Eastern WA we aren’t feeling the same impact. Occupancy continues at record lows and not one of the 294 property owners I’ve spoken with in the last two months are reporting any major rent collection issues.
- Off-market deals picked up speed in the last month. A surprising 304 units across 4 properties are under contract via local relationships. Landing these deals comes down to timing and local relationships. I plan to have a few opportunities for you in the first half of 2021.
- Thank you to all property management teams, especially during the holidays. Combine a record number of packages on top of an already challenging year and these front-line workers deserve a lot of credit.
- Light industrial developments have continued steadily throughout 2020, bringing new space online throughout the year. One example is the recently delivered warehouse space at 450 Stevens Dr with one suite left to lease. Need warehouse space? Reach out and we'll uncover some hard-to-find space for you.
- Along with new projects, lease rates have steadily climbed throughout 2020, driven by strong tenant demand. If you're interested in developing industrial space, now is a good time to do so. Looking ahead the next 10 years, we don’t see absorption slowing down.
- I’m working with a few developers in the industrial space, helping them identify sites for their next project. Want to explore a new industrial project in town and need the local data to do so? Reply to this email.
- A new project was announced for Richland's Horn Rapids. The national guard has selected a 40-acre site for their new facility. This will replace their Bellingham location. Projected completion is January 2022.
- Another new project was announced for North Richland. Energy Northwest and Tucci Energy have plans for a 300-acre solar project with construction slated for Spring 2022.
- I’m not seeing any slowdown in development interest or activity. Multiple projects are in early stages and while there were delays from March to May, developers see smooth sailing ahead. I recently learned of three additional multi-family developments in early stages and multiple industrial developments. Want to learn more about the specifics? Reply to this email.
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Wishing you and your loved ones a Merry Christmas and a Happy New Year!