The Winston-Salem commercial real estate market is dynamic and continues to evolve. Let’s delve into the key trends observed in 2024 and explore what the future holds for 2025.
2024 Winston-Salem Market Overview:
- Industrial: Strong demand persisted with a 7.9% vacancy rate. Rent growth was most significant for flex spaces and properties strategically located near transportation hubs.
- Multi-Family: Increased demand drove down vacancy rates, which are currently at 9.3%. Rents have increased by 2.3% year-over-year and are poised for continued growth.
- Retail: Low vacancy (2.7%) indicates strong tenant demand. However, market asking rent growth (3.8%) is trending downward. Average sales prices have reached $160.88/SF.
Investor Preferences in 2024:
- Existing Buildings: 61% of investors favored existing buildings, a significant shift from 51% in 2023.
- Purchase Over Lease: 20% of investors preferred to purchase properties, a substantial increase from 52% in 2023.
- Rail Access & Expandable Sites: While still important, the emphasis on on-site rail access and expandable sites has slightly decreased compared to 2023.
Data provided by Greater Winston-Salem, Inc. Economic Development Report
2025 Winston-Salem Market Predictions:
- Industrial: The positive trajectory of the industrial sector is expected to continue. Demand for well-located and modern facilities will remain high, particularly in areas with strong logistics infrastructure.
- Multi-Family: With population growth anticipated, the multi-family market is poised for continued expansion. Demand for high-quality, amenity-rich apartments is likely to increase.
- Retail: The retail sector has the potential for growth, particularly in well-located shopping centers that adapt to evolving consumer preferences (e.g., experiential retail, omnichannel strategies).
- Investor Focus: The trend towards purchasing existing buildings and prioritizing cash flow will likely continue. Investors are likely to seek opportunities in value-add properties and those with strong long-term growth potential.
Key Takeaways:
- The Winston-Salem commercial real estate market presents both opportunities and challenges.
- Industrial and multi-family sectors are experiencing strong growth and are expected to remain favorable in 2025.
- Retail and office markets will require strategic adjustments to navigate evolving market dynamics.
- Investor preferences are shifting, with a focus on existing properties and long-term value.
Disclaimer: This blog post provides general information and should not be considered financial or investment advice.