2021 First Quarter Market Report

The economic impact of the COVID-19 pandemic was still evident in the South Coast commercial real estate market in Q1, with virtually all indicators diminished compared to pre-pandemic levels. However, as the spring progresses, our brokers report a noticeable growth in activity and are cautiously optimistic that Q1 will prove to be the last stagnant quarter of the current cycle.

Here are some summary points on Q1:

  • Transaction value decreased 42% for sales and 30% for lease consideration, compared to Q1 5-year averages.
  • Off-market sales and purchases by owner-users both dropped substantially, perhaps indicating “pandemic fatigue” in demand•Lease transactions and gross absorption decreased 25% and 44% respectively compared to Q1 5-year averages.
  • The available inventory of 263 spaces for lease is the largest on record.
  • On the positive side, deal velocity picked up later in the quarter—combined transaction value grew from $15M in January to $55M in March—and has continued to advance so far in Q2.

For your copy of Hayes Commercial Group’s Market Report email liam@hayescommercial.com

Author: Liam Murphy

Liam Murphy is a partner at Hayes Commercial Real Estate and supports many national clients in their commercial real estate needs. He holds the distinguished Certified Commercial Investment Member (CCIM) designation as a recognized expert in the disciplines of commercial and investment real estate. Less than 6 percent of the commercial real estate practitioners nationwide have earned the CCIM designation.

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