The Queen City Welcomes Yet Another Financial Powerhouse
- Charlotte will soon be home to another banking headquarters with the announcement of the Suntrust and BB&T merger with a subsequent relocation, creating the sixth largest bank in the country. Their total office footprint seems to be a moving target, but rumors are they could absorb an excess of 500,000 square feet.
- Cranes continue to paint the skyline as the total development pipeline hovers around 3.6 Million square feet. Most of the activity is concentrated to the CBD submarket, while there have been several projects announced that are slated for the South End submarket.
- Absorption slightly dipped over the previous quarter, but the year started off with over 245,000 square feet of growth. The largest driver was Wells Fargo inking a deal at 300 S. Brevard Street in the CBD for 360,000 square feet.
- Rental rates continue to rise and that is reflected in an overall asking rate of $28.33 per square foot. Overall the urban submarkets rates dipped ever so slightly, but they will likely jump back up in the second quarter of 2019.
Q1 2019 Charlotte Office Market Summary
Over the last six (6) months, Charlotte has seen a flurry of major announcements, creating a strong sense of confidence throughout the market. Thousands of new jobs have been pledged for the region which has bolstered preleasing activity in new developments around the urban core. Companies continue to move towards office space that are amenity rich, proximate to public transportation and can effectively showcase the company culture. These factors have driven demand and development from Uptown (CBD) to South End, where several hundred thousand square feet is planned or breaking ground this year.
Going into the second quarter, expect absorption to increase as several of these notable corporations begin to finalize leases. Rental rate growth should remain steady, although it may not be as rapid as the previous year. Investment activity is also expected to keep pace as more out of market groups continue to bet on the growth of the Queen City.