Charlotte's Got Another Good Year Ahead--And Probably More
The speakers at Bisnow's Charlotte State of the Market event recently at the Fillmore Theater agreed the real estate cycle is going to swing downward again. It always does. The question is when. The consensus was, not this year, and probably longer than that.
On the whole, our speakers were optimistic about 2016 for Charlotte real estate, and maybe even '17, although factors well beyond Charlotte—such as the uncertainty that comes with an unpredictable national election, or overseas turmoil—have the potential to disrupt things here. Even so, Charlotte's creating jobs and people want to live here, and that bodes quite well for developing and leasing this year.
Despite the optimism, there are still challenges, especially for developers in the Charlotte market, our speakers said. Construction costs combined with being late in the cycle and a good bit of new supply are making it increasingly difficult for development deals to pencil anywhere but the very best sites. Higher labor costs are driving most of the increases in construction costs.
Even though demand is fairly strong for office space, our speakers stressed that Charlotte office landlords' biggest challenge is attracting and retaining tenants. "We know that our customers need an officing solution that specifically supports work/life balance," noted Chris Epstein. The office environment has to avoid creating a chasm between work and home.
Aston Properties president George Dewey, BECO South & BECO Midwest president Chris Epstein, Selwyn Property Group principal Jensie Teague, and CohnReznick partner Cristi Lewis, who moderated.
Google Fiber Charlotte business operations lead Mary Ellen Player also spoke at the event, offering the latest on Google's installation of its fiber system, currently along major thoroughfares in Charlotte. Eventually the entire city's going to have it, and the fiber will be another key attracter for businesses thinking about relocating here.