Number of annual transactions trending to set new record high with 25% increase over 2016.
“As goes the economy, so goes commercial real estate.” It’s a saying that has held true on a global scale for centuries, and Frederick County commercial real estate sales volume and values have experienced nothing different.
With statistics in now from the first three quarters of 2017, the path seems to be clear that by the end of the year CRE sales will set a new record high for not only sales volume, but also for the number of transactions.
Since 2012, the combined annual sales of a broad range of commercially defined uses (office, warehouse/flex, mixed commercial/residential, retail, multifamily, hospitality, specialty use and development land) has resulted in volumes of $200 million to last year’s $330 million. The number of transactions in these categories have ranged between 135 and 150 per year during similar periods.
Through September 30th, sales volume for 2017 has already topped $307 million and the number of deals closed has reached 128. With the average 4th quarter volume over the previous 3 years being $102 million and transactions at 41, it is a pretty good bet that 2017 will finish with over $400 million in sales and over 160 transactions, which will reflect an overall increase over 2016 of about 25% in both categories!
Does that mean that commercial real estate values will have increased by a factor of 25% over a twelve-month period? Not a chance! Hey, we are not in the bubble years of 12 years ago!
What it does mean is that there are many more buyers in the marketplace who are opening their wallets and betting on Frederick and its diversified the economy to keep chugging along.
I’ll take that bet!
Next week, we will place more focus on some of the specific transactions of 2017’s third quarter results.
It’ll be worth your while to stay tuned!