Want to quickly know the latest in your market? The Real Deal is highlighting the market conditions in the top 22 cities around the country, updated every quarter.
In the second quarter, home prices in the top cities in the U.S. remained elevated, particularly in New York, whose luxury market put up one of its best monthly performances in June.
However, there were signs of softening in some markets. Across many Sun Belt markets like Phoenix, Charlotte and Nashville, buyers were taking longer to buy homes compared to the same time last year.
On the commercial front, office leasing activity rebounded across many of the top cities, as return-to-office mandates continue to bring workers back into offices. However, markets like Washington, D.C. and Nashville, which have many federal tenants in its offices, continue to struggle amid a slew of slashed leases by President Donald Trump’s administration.
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NEW YORK
RESIDENTIAL: SALES
In the second quarter, Manhattan continued to see deal volume and home prices rise, according to a report from brokerage firm Corcoran.
Manhattan recorded more than 3,250 closings, rising 5 percent year over year, per the report. Meanwhile, signed contracts also rose for the fifth straight quarter by 3 percent year over year. Total deal volume soared by 12 percent to more than $7 billion in the second quarter as well.
International buyers and sellers are a strong part of its performance, according to an analysis of public records by The Real Deal.
In the first half of 2025, there has been roughly one foreign buyer for every two foreign sellers, the lowest that ratio has been since the first half of 2020. The ratio peaked in 2023, when there were 3.6 international sellers for every buyer.
RESIDENTIAL: LUXURY MARKET
For Manhattan’s luxury market, June was one for the books.
Buyers signed contracts for 153 properties in the borough asking $4 million or more between June 1 and June 29, according to Olshan Realty’s report. The total landed among the three highest for the month since the brokerage began tracking the data nearly two decades ago.
Manhattan logged 27 inked deals last week, up from 28 in the previous period. Of the homes to find buyers, 15 were condos, seven were co-ops and five were townhouses.
The priciest property to enter contract was a condo at JDS Development and Property Markets Group’s 111 West 57th Street, with an asking price of $20.5 million. The 4,500-square-foot apartment has three bedrooms, three bathrooms, 14-foot ceilings in the great room and views of Central Park.
Meanwhile, sales of Brooklyn’s prized brownstones, mansions and standalone homes appear to be falling off — even as prices are ticking up.
Home sales for standalone residential buildings — mostly single-family homes — in the borough fell about 12 percent in the second quarter from the quarter before.
The Real Deal analyzed New York City data of home sales for single-, two- and three-family properties for each Brooklyn neighborhood from the second quarter of 2020 through the second quarter of this year. TRD did not include co-ops or condominium deals in the analysis.
The Big Apple’s most populous borough recorded just over $1.6 billion worth of sales of these properties across 1,089 deals — more than 200 fewer deals than the quarter before. The total sales volume figure, while down quarter over quarter, was up a bit from the same time last year, by 0.5 percent.
RESIDENTIAL: RENTALS
Summer has arrived in New York, and so too have summer prices.
The median Manhattan rent reached a new all-time record in June, the fourth time that’s happened this year. At $4,625 for a brokered apartment, the median rent in the borough rose 7.6 percent from last June, according to the monthly report from appraiser Jonathan Miller for Douglas Elliman.
One new factor at play is the FARE Act, a city law that makes landlords, not renters, pay commission for rental brokers they hire. That’s likely resulted in higher monthly prices, Miller said, as owners try to recoup the new expense. Using some back-of-the-envelope math, he estimates the law has pushed rents up by 1 percent monthly, meaning about 12 percent annually. That tracks with recouping a fee that is typically 10 to 15 percent of annual rent.
DEVELOPMENT
The top builders in New York City are building fewer and smaller projects.
That’s according to analysis by The Real Deal of building permits issued in the Big Apple where the applicant is a general contractor between March 1, 2024 and March 1, 2025.
The top five builders — Monadnock Construction, Leeding Builders Group, Suffolk Construction, Aecom Tishman and Lendlease — remained the same year over year, though their places in the ranking shuffled.
The total estimated square footage of the projects greenlit by the city for these top companies came in at 19.3 million square feet in 2025. That is 13.9 percent lower than the year before. The number of issued permits also fell, by 43.8 percent, to 45.
News of tariffs have rattled scores of industries and the stock market for the first part of this year. But the city’s top contractors earlier this year said they had not felt their effects just yet.
COMMERCIAL: RETAIL LEASING
New York’s retail leasing market is getting tight.
Vacancies in Manhattan’s prime retail corridors reached their lowest number since JLL started releasing quarterly data on the metric in 2017, according to a new report from the brokerage. About 14 percent of retail spaces in those markets were available in the second quarter of 2025, dropping just over a percentage point year over year.
Asking rents in those corridors have not fully recovered, but they did notch a post-Covid record, reaching an average of $608 per square foot last quarter. That’s the highest number since the summer of 2020 and an 11 percent year-over-year jump.
COMMERCIAL: FINANCE
Two large commercial mortgage-backed securities issuances topped the city’s real estate loans in June, reflecting the continued strength of the CMBS market.
Although CMBS loans from private lenders declined in the second quarter, a total of $59.55 billion in CMBS debt was issued in the first half of the year, a 35 percent increase from a year earlier and the largest volume in more than 15 years, according to Trepp.
Blackstone and Fisher Brothers’ 1345 Sixth Avenue scored the largest CMBS loan, for $850 million, at the same time that Blackstone bought a 49 percent stake in the Midtown office tower. It was Blackstone’s first big move in Manhattan’s office market since 2022.
Downtown, Vornado Realty Trust and Stellar Management scored $675 million in CMBS debt for their massive multifamily complex Independence Plaza, where 40 percent of units are either rent-regulated or designated affordable.
COMMERCIAL: HOTELS
New York City’s hotel market has faced its fair share of challenges in recent years, but has spent 2025 overachieving.
The sector is outperforming the national average in several key metrics in the first six months of 2025, the Wall Street Journal reported. Combined with a steady flow of tourism in the past two years, the Big Apple is taking a bite out of its hospitality competition in other markets.
In the first half of the year, the average weekly occupancy rate of hotels in New York City was 82 percent, according to CoStar. That’s in line with the rate from last year and a staggering 20 percentage points higher than the national average.
Revenue per available room in the city per night averaged $238.93 a week, far outpacing the national average of the same metric, which didn’t even cross the $100 per week mark.
Last year, 64 million visitors streamed into New York City, approaching a record. The city’s tourism organization expects a similar number of visitors this year, a large majority of whom are domestic travelers.
SOUTH FLORIDA
RESIDENTIAL: SALES
South Florida’s residential market has been slowing for months, and June was no exception.
Sales fell in June, year-over-year, as dollar volume for Miami-Dade, Broward and Palm Beach counties dropped to $4.8 billion from $5.3 billion in June of last year, according to Multiple Listing Service data collected by the Miami Association of Realtors. That equates to a 9 percent drop for the tri-county region.
Miami-Dade County was the only market to show price growth, with median prices falling for both single-family homes and condos in Broward and Palm Beach counties.
At the same time, more homeowners are putting their properties up for sale across South Florida, but inventory levels are still at pre-pandemic levels.
DEVELOPMENT
A group of landowners want to expand Miami-Dade County’s Urban Development Boundary by 64.8 acres for a mixed-use project with over 1,000 residential units.
The Urban Development Boundary, or UDB, aims to restrict suburban sprawl east onto Biscayne National Park and west onto the Everglades, as well as onto farmland, wetlands and other open land that could be needed for the preservation of the national parks. Historically, developers’ proposals for projects outside the UDB have been contentious, drawing opposition from environmentalists, and requiring a super-majority approval from county commissioners.
Herkoz filed an application for an up to 1,200-unit residential development with single-family homes and apartments, and up to 90,000 square feet of retail on the northwest corner of Southwest 137th Avenue and Southwest 248th Street, according to county filings. It would include some below market units, with 20 percent of the residents designated for households earning up to 140 percent of the area median income.
Additionally, construction sites are among the primary targets for ICE agents. Local municipalities such as Coral Gables, Doral, Miami and Hialeah have signed cooperation agreements to help detain immigrants. Florida Gov. Ron DeSantis turned an abandoned jetport in the Everglades into Alligator Alcatraz, a makeshift detention facility that is facing lawsuits over inhumane conditions and environmental damage.
Hard data on how many construction workers have been detained and deported is not available, but TRD interviews with day laborers, union representatives, immigration attorneys and construction industry experts reveal anecdotal evidence that show how fear of being raided by Immigration and Customs Enforcement (ICE) has had a chilling effect on hiring practices.
COMMERCIAL: OFFICE LEASING
In the second quarter, the office vacancy rate was highest in Miami-Dade county, according to a report from Walter + Duke. The rate in that county was 14.6 percent, compared to 10.9 percent in Broward County and 9 percent in Palm Beach.
However, asking rents rose across all three South Florida Counties, with Palm Beach recording the largest growth rate in the region of 4.7 percent year over year. Rents rose by 2.7 percent year over year in Miami-Dade and by 1.2 percent in Broward.
COMMERCIAL: RETAIL
Across South Florida, retail landlords experienced more tenants moving out of spaces than tenants moving in during the second quarter, according to a recent Colliers report. As a result, the vacancy rate in the tri-county region took a slight hit and average asking rents in Miami-Dade and Palm Beach counties tumbled a bit.
The high cost of construction is providing some silver lining for existing retail property owners. South Florida is seeing a slowdown in new retail development with 1.4 million square feet on tap for this year compared to 3.2 million in 2020, Colliers found. Although, retail landlords are hardly in panic mode as vacancy rates remain below 5 percent in South Florida despite the rising exodus of tenants.
LOS ANGELES
RESIDENTIAL: SALES
Southern California’s housing market appears to be on the up-and-up long term after a dropoff in sales from May to June.
In June, L.A. County saw a 5.4 percent decrease in home sales from May, though the figure was up 1.1 percent year-over-year, according to the latest monthly sales report from the California Association of Realtors. At the same time, Orange County saw a 1.2 percent decrease in home sales in May and a modest 0.1 percent increase from the previous June.
Los Angeles, San Bernardino and Imperial Counties saw home prices increase quite a bit from the previous month. L.A. County saw the biggest jump of 8.2 percent from May to June, or an increase in median home sale price to $903,650 in June from $835,480 the month prior. That’s part of a yearlong rebound in prices, as last June’s median home sale price was $889,190, according to CAR.
Meanwhile, in Orange County, home prices recovered from a slight tumble. The median price in the O.C. was $1.47 million in June, a 3.3 percent increase from $1.42 in May and 1.4 percent increase from $1.45 million a year ago.
Additionally, nearly 60 percent of international homebuyers in California hail from Asia or Oceania, according to a new National Association of Realtors report.
Fifteen percent of foreign buyers who purchased a residential property in the U.S. bought in California, SF Gate reported, citing a new National Association of Realtors report, which tracked data from last April to this March. Of those California buyers, 57 percent were from Asia or Oceania, followed by Latin America at 18 percent.
RESIDENTIAL: RENTALS
The average monthly rent in Los Angeles in July was $2,779, a $14 drop — 0.5 percent — compared to the month before.
Rents in the Chatsworth section of the city fell by nearly 32 percent month over month to $3,500. They grew by more than 14 percent in Encino, where the median rent is about $5,500 a month.
DEVELOPMENT
Los Angeles County has unveiled its plan to help rebuild unincorporated areas torched by wildfires early this year.
The new L.A. County Forward: Blueprint for Rebuilding plan details how officials and residents can rebuild in a low-cost, streamlined approach to recovery efforts, L.A. Business First reported. The outline is designed for the county to create an “equitable reconstruction” process and better support rebuilding residents in unincorporated areas as their properties emerge from the ashes.
The plan emphasizes six priorities for the county that officials believe are paramount to rebuilding. They include streamlining permitting resources, reducing building costs, restoring critical infrastructure, mobilizing a stronger workforce, expanding the pool of builders and bringing back public assets and services.
Meanwhile, as more homeowners make the decision to stay in Los Angeles and rebuild following the wildfires in the city earlier this year, nailing down a consensus on cost is a bit like herding cats. In other words, a painful exercise with seemingly no point.
The construction inflation is real, according to Mkrtichyan who said some of the quotes he hears are coming in wildly beyond reality for his company.
An example? The conversation around pricing that’s $700 and above per square foot to rebuild. Mkrtichyan can’t see it.
“There’s not one client that I’m charging $700 a square foot,” he said. “I built three homes in the Palisades prior to the fires below that number. Now, OK, I understand there’s been some appreciation. There’s a labor shortage, especially with ICE [raids], but I know this is not the reason for these numbers people are talking about.”
DEVELOPMENT: MULTIFAMILY
The vast majority of the largest building projects that the City of Los Angeles has greenlit in the first half of the year will be apartment complexes.
Seven of the top 10 projects by square footage are multifamily properties, and all but one of those projects have at least some affordable housing component, according to an analysis by The Real Deal of the city’s new building permits issued from Jan. 1 to June 25.
COMMERCIAL: OFFICE LEASING
In the first half of the year, Los Angeles saw more than 7 million square feet of leasing activity, according to data from commercial brokerage Savills. That’s nearly 17 percent higher year over year.
One top lease was Oaktree Capital Management’s relocation to City National Plaza in Downtown L.A., where the firm will take up about 220,000 square feet.
In the second quarter, total leasing activity also was above the five-year quarterly average of 2.9 million square feet.
However, the availability rate ticked up by 20 basis points quarter over quarter. The average asking rent also rose to $3.99 per square foot, as new supply hits the market over the next 12 months.
COMMERCIAL: INDUSTRIAL
The dropoff in demand for industrial space in the Inland Empire has left some landlords scrambling.
Tenants in the I.E., the Western U.S.’ most active warehouse and logistics hub, have vacated 4 million square feet more than they moved into in the second quarter, according to CoStar. That marks one of the biggest quarterly occupancy losses of any industrial market in the country last quarter.
As it stands, the I.E.’s industrial vacancy rate is at a 15-year high of 8.5 percent, according to CoStar, above the nationwide industrial vacancy rate of 7.5 last quarter.
CHICAGO
RESIDENTIAL: SALES
Chicago-area homebuyers faced record-setting prices in June, as strong demand and tight inventory pushed the cost of housing to new peaks locally and nationwide.
The median price for a home in the city reached $400,000, a 5.8 percent increase from June 2023 and the highest on record, Crain’s reported, citing the Chicago Association of Realtors. Across the nine-county Chicago metro area, prices climbed 3.9 percent to a record $389,450.
Chicago’s pace of price growth outstripped the national average. Home prices rose 6.09 percent in May, second only to New York among the 20 major metros tracked by the S&P CoreLogic Case-Shiller Indices. Most other cities saw increases below 3 percent, and some even experienced declines. Chicago was also one of just five metros where price growth accelerated from April to May.
RESIDENTIAL: LUXURY SALES
Downtown Chicago condo market sales continue to struggle with ever-decreasing value, as some properties are changing hands for substantially less than what they sold for more than 15 years ago.
The downtown slump is by all accounts an outlier to the rest of the Chicago-area’s robust housing market. Local real estate agents point to a combination of a slow return to office work from the pandemic and an increase in downtown criminal activity, as reported by Crain’s. The perception of downtown as a “prime, luxurious market” has dwindled, Coldwell Banker’s Chezi Rafaeli told the outlet, as buyers look beyond Streeterville and the Loop to the West Loop, Lincoln Park and beyond.
Recent sales recorded during the last few days showed losses in value in the millions, such as a three-bedroom condo in the tower at 900 North Michigan Avenue — called the Bloomington’s tower — that sold for $2.62 million. In 2009, the sellers of the property paid $5 million for it, or nearly twice the recent sale price. A condo in the St. Regis tower, at 363 East Wacker Drive, listed for $8 million last week, down $1.2 million from the seller’s purchase price in 2022, The Real Deal first reported.
DEVELOPMENT
Chicago is bringing up the rear in new home construction among the country’s 10 largest metro areas, a result of slow population growth, heavy regulation and long-standing industry frustration, Crain’s reported.
Municipalities across the Chicago area issued just 4.5 permits for new homes per 1,000 existing housing units last year, according to Construction Coverage. That’s less than half the national average, which is 10.1 permits per 1,000, and ranks Chicago last among the country’s largest markets. Dallas led the pack with 22.2 new homes per 1,000 units, nearly five times Chicago’s rate.
Meanwhile, developers are still optimistic about Chicago’s industrial market despite fears of oversupply, which began to take hold last year, following the pandemic-fueled industrial building boom.
Speculative industrial development overtook built-to-suit projects in the second quarter, for the first time since early last year, according to NAI Hiffman.
There are 11.4 million square feet of industrial space under construction in the Chicago area, of which 50.5 percent is speculative.
Notable projects include a 1.2 million-square-foot speculative development by DHL in Plainfield, and an 802,000-square-foot speculative property in Joliet being developed by Northern Builders.
Additionally, conversions are the darling of developers looking to unlock capital in today’s tight lending environment.
COMMERCIAL: OFFICE LEASING
In an otherwise dismal suburban office market, the O’Hare area is gaining.
The submarket boasted the highest average asking rent in Chicago’s suburbs last quarter, with rents up 5.5 percent year-over-year, according to Transwestern. The submarket’s average rent climbed to $33.07 per-square-foot, outpacing the average suburban Chicago office rent of $27.12 per square foot.
No other suburban Chicago submarkets tracked by Transwestern saw rents increase by more than 1.5 percent year-over-year, and rents fell by more than 5 percent in two submarkets.
Even with O’Hare’s slight advantage, the overall region is in worse shape than it was pre-pandemic.
In 2019, the suburban office market’s direct vacancy rate hovered around 15 percent and now sits at 20 percent. The overall vacancy rate, which includes space being marketed, is at 26 percent.
SAN FRANCISCO
RESIDENTIAL: SALES
San Francisco’s housing market has seen quite the improvement over the past year, though it’s slowed in recent months.
San Francisco saw a 12.2 percent increase in home sales year-over-year from June 2024 to 2025, according to the latest report from the California Association of Realtors. Home sales in San Francisco ticked up 1.2 percent from May to June to 221 single-family residence sales in the month of June.
Homes went for well above asking price in San Francisco in June. The city saw a 111.2-percent sales price-to-list price ratio in the past month and a 3.3 percent increase in sales prices year-over-year. From May to June, though, sale prices fell 5.3 percent.
Sales prices in the Bay Area at large, meanwhile, held steady.
The region saw no change in sales prices from May to June and from June 2024 to June 2025. Home sales increased 1.6 percent from May to June and 1 percent year-over-year.
RESIDENTIAL: RENTALS
As of July, the average rent for an apartment in San Francisco was $3,522, with the average apartment measuring 735 square feet, according to rental listing platform RentCafe.
The priciest neighborhood was Presidio, where the average rent was $5,062, and the least expensive rents could be found in Tenderloin, where the average rent was $2,046.
Meanwhile, the most popular neighborhood was Hayes Valley. That area had 149 listings on the platform, with an average rent of just under $4,000 a month.
DEVELOPMENT
A health care construction boom has hit the Bay Area, caused by California’s looming 2030 seismic safety deadline and a changing care delivery model that favors smaller, more specialized facilities alongside major hospital upgrades.
Data from the California Department of Health Care Access and Information shows total construction costs for health care projects in the nine-county region reached $2.67 billion in October 2024, the San Francisco Business Times reported. That figure is short of the $4.2 billion peak in 2017, but it’s the highest since the pandemic.
Sutter Health’s $422 million, five-story neuroscience complex at 3555 Cesar Chavez Street sits inside its Mission Bernal campus and looms as one of the region’s largest active projects. Breaking ground in June and slated to open in 2028, the facility will consolidate key neurology services, including the Ray Dolby Brain Health Center and Forbes Norris MDA/ALS Research and Treatment Center, and serve as a regional neurosurgery and stroke hub.
Additionally, South San Francisco is shaping up to be a bright spot for housing construction in the Bay Area amid stagnant progress in the region.
Three large-scale apartment projects are in the works in the Peninsula city, signaling a forthcoming increase in housing capacity for the region, the San Francisco Business Times reported.
COMMERCIAL: OFFICE LEASING
In the second quarter, San Francisco’s office market saw 2.5 million square feet of leasing activity — a drop from 3.4 million square feet reported during the first quarter of the year, according to commercial real estate brokerage Savills.
However, second-quarter leasing activity was higher than the city’s five-year quarterly average of 1.4 million square feet.
The availability rate for the office sector fell by 120 basis points quarter over quarter to 34.5 percent. That figure also is 180 basis points lower year over year.
Asking rents also fell in the second quarter to $66.30 per square foot from $68.56 compared to the year before. Asking rents were stable quarter over quarter.
COMMERCIAL: RETAIL
San Francisco’s beleaguered Powell Street retail corridor could be ready to rebound.
The street has seen a wave of new boutiques and major retailers that are helping bring it back to life, according to nearly two dozen building owners, tenants, leasing agents and other local stakeholders, the San Francisco Standard reported.
TEXAS (DALLAS, HOUSTIN, AUSTIN, SAN ANTONIO)
RESIDENTIAL: SALES
Master-planned communities aren’t insulated from the economic uncertainty affecting consumer activity and the housing market.
As the country’s second-largest market for master-planned communities (behind Florida), Texas stands to feel the pain.
New home sales in the country’s top master-planned communities dropped nearly 7 percent in the last 12 months, from June 2024 to June 2025, according to real estate consultant RCLCO.
The drop in sales for new homes in master-planned communities matches the drop in sales for new homes in the broader market, also posting a seasonally adjusted 6.6 percent decline, RCLCO reported, citing data from the Census Bureau.
The median sales price nationwide was also down in the last year, dropping 2.9 percent from $414,000 to $401,800. The median sales price of a home in Houston was $346,651 in June, unchanged from June 2024, according to a recent report from the Houston Association of Realtors.
Additionally, a new Texas law targeting land purchases by foreign nationals from China, Iran, North Korea and Russia is chilling real estate investment ahead of its September implementation, industry pros say. The vague language in the legislation has brokers and attorneys scrambling for clarity.
Senate Bill 17, signed into law by Gov. Greg Abbott in June, will ban the purchase of real estate — including residential, commercial, industrial and agricultural — by entities tied to those four countries starting Sept. 1. It also prohibits related property interests such as leases longer than one year, easements and mineral rights. Permanent U.S. residents are exempt, but enforcement details are scarce.
RESIDENTIAL: RENTALS
Houston has been called the most stable multifamily market in Texas. But older, class B and C apartments are losing occupants while single-family leasing grows.
Single-family leases and inventory grew in the first half of the year compared to last year, according to the Houston Association of Realtors. Just under 24,000 leases were signed between January and June this year, a 5 percent increase year over year. New listings grew 13 percent year over year to 36,448.
The Houston area set a record for rental house inventory in June, when new listings of single-family homes jumped 12.7 percent year over year to 7,117. Last month, 4,590 single-family leases were signed, marking a 5.2 percent year-over-year increase.
Apartments, especially older stock, aren’t experiencing the same growth.
Houston’s multifamily market has avoided the rent declines that hit other Texas metros in the past two years. While Austin and Dallas turned negative in 2023 and 2024, rents in Houston continued to tick up, according to CoStar.
DEVELOPMENT
It’s not all full speed ahead for developers in the fastest-growing city in the country, where boomtown status has its limits.
Princeton extended its moratorium on residential development for the second time as it races to catch up with its own population boom, the Dallas Business Journal reported.
Meanwhile, the Dallas City Council is set to decide what kind of investment and development could be built in a West Oak Cliff neighborhood, in a case dividing residents on how to shape the future of the community.
The rezoning case affects 35.25 acres centered on the intersection of Hampton Road and Clarendon Drive. It would allow mixed-use and small multifamily buildings and encourage pedestrian-friendly development, the Dallas Business Journal reported. City officials have viewed the area as ripe for rezoning for such developments since 2019, and it’s part of the city’s broader efforts to encourage density and walkability in development.
As for statewide development news, Apple committed to a multibillion-dollar investment in U.S. manufacturing focused heavily on the Texas Triangle, during a meeting at the White House on Wednesday, in a move that could be a boon for real estate developers across the state.
Apple CEO Tiim Cook promised to spend $100 billion on U.S. manufacturing, on top of the $500 billion investment announced by the company in February, the Dallas Morning news reported.
Those investments — what it calls the American Manufacturing Program — include making laser equipment in Sherman, adding a second office campus in Austin and developing a server farm in Houston.
COMMERCIAL: OFFICE LEASING
The Dallas-Fort Worth office market finally caught a break, if only in Uptown’s penthouse suites.
The metroplex market posted its first drop in vacancy since 2019, driven almost entirely by flight-to-quality demand for trophy and Class A space, especially in Uptown, the Dallas Morning News reported.
Overall vacancy declined from 26.1 percent to 25.3 percent in the second quarter, according to Avison Young. Still historically high, it’s the first meaningful improvement after years of hemorrhaging occupancy.
Nearly all the absorption came from higher-end assets: the Class A segment absorbed 472,000 square feet in the second quarter alone, pushing its year-to-date total to 1.3 million square feet. Class B buildings, by contrast, posted another 294,000 square feet in negative absorption.
Additionally, the federal government is ending 21 office leases in Texas this year, amounting to 97,000 square feet. That puts Texas in 12th place nationally for federal lease cancellations.
COMMERCIAL: RETAIL
Fitness and entertainment concepts are racing to backfill space shed by failed big-box retailers across Texas, keeping vacancy rates well below historic averages.
A string of major retail bankruptcies, including Party City, Joann, Big Lots and Conn’s, resulted in a 66 percent year-over-year increase in store closings nationally this year, according to Coresight Research. However, fitness centers and entertainment retail have been quick to fill space in Texas, contributing significantly to the state’s low vacancy rates.
The vacancy rate halfway through the year was lower than the 20-year historic average in Austin, Dallas-Fort Worth, Houston and San Antonio, according to Partners Real Estate. Houston had the highest vacancy at 5.5 percent.
In DFW, where the retail vacancy rate is 4.8 percent, compared to a historic average of 6.4 percent, Crunch Fitness, EoS Fitness and the Picklr had leased 115,000 square feet halfway through this year. Crunch has also leased almost 44,000 square feet in Austin and over 54,000 square feet in San Antonio.
BOSTON
RESIDENTIAL: SALES
For the first time, the median price of a home in the Greater Boston area has reached a seven-figure sum.
The Greater Boston Association of Realtors revealed the median price for a single-family home in the market last month hit $1 million, Axios reported. The market’s been trending towards that benchmark for the past three months.
Boston’s market favors sellers, even though homes are hanging up in the marketplace for a longer period of time than a few months prior. The homebuyer hope of diminishing prices has yet to materialize.
That’s not the case in the condo market. The median price of a condo in the market dropped to $725,000 last month, a 3.3 percent decline from the previous month. It was also down from last year.
For a median-priced home, a family would likely need a roughly $200,000 down payment, excluding other considerations such as closing costs, HOA fees, utility bills and repair expenses. That’s more than double the city’s median household income in 2023.
RESIDENTIAL: RENTALS
In the second quarter, the average rent in Boston was $2,949, up 2 percent year over year, according to real estate firm MMG.
The multifamily occupancy rate ticked down 20 basis points to 95.7 percent in the second quarter, as the city saw about 5,400 new units hit the market in the first half of 2025 and absorption was just over 2,900 units.
DEVELOPMENT
Conversions are growing in popularity in the state and its biggest city, Boston, according to Bisnow. Developers and relevant stakeholders recently discussed the prevalence of office-to-residential conversions at an industry event.
As of last month, Boston has 15 office-to-residential conversions in the works. Those projects are expected to deliver 762 units.
It’s helpful to developers that the state and their municipalities are putting support behind conversions. The state government launched an initiative to accelerate conversions, while MassHousing allocated $1 million in planning funds for technical assistance.
The state has awarded money for Synergy’s 198-unit conversion in Worcester, KS Partners’ 80-unit project in Boston and Dinosaur Capital Partners’ 110-unit project, also in Boston. An official from Dinosaur said the project wouldn’t have penciled out without state funding and the city’s office-to-residential payment in lieu of tax program.
Additionally, Massachusetts is unleashing land for housing developers.
Gov. Maura Healey and Lt. Gov. Kim Driscoll in June released an inventory of more than 450 acres of surplus state-owned land identified for housing development. The land is expected to house roughly 3,500 units across the state.
The state plans to make 17 sites available to developers over the next year. Requests for Proposals will be issued for 10 of those sites, while an auction is expected to be held for the other sites this September.
“These 450 acres will be turned into thousands of new homes that families, seniors and workers can actually afford,” Healey said in a statement.
COMMERCIAL: OFFICE LEASING
In the second quarter, leasing velocity fell by about 159,000 square feet compared to the quarter before. Leasing volume came in at just over 932,000 square feet, according to a report from commercial real estate services firm CBRE.
Office space availability in the city rose by 20 basis points to 2.3 percent compared to the first quarter. The market’s vacancy rate also climbed, by 80 basis points, to about 19 percent quarter over quarter — in part because 115,000 square feet of space at 401 Park Drive came on the market, after it was originally marketed as lab space.
The average asking rent for Boston office space ticked down by 21 cents quarter over quarter to $65.89 per square foot gross, per CBRE. Class A rents fell by $1.07 to $72.17 per square foot gross; Class B/C rents inched 29 cents lower to $51.55 square foot gross.
WASHINGTON, D.C.
RESIDENTIAL: SALES
In July, home prices in the nation’s capital had increased by 1.5 percent, in line with recent national trends, according to residential brokerage firm Redfin.
The median sale price for homes in Washington, D.C. that month was $685,000, and buyers snatched up properties in the city in an average of 57 days.
Deal volume was also up in Washington, D.C., in July, according to Redfin. In July 2024, there were 590 sales, which rose to 626 deals this July.
RESIDENTIAL: RENTALS
D.C.’s biggest rental reform in years is one vote away from becoming law.
The City Council advanced a scaled-back version of Mayor Muriel Bowser’s RENTAL Act in a 10-2 vote on Monday, Bisnow reported.
The revised bill still tackles two longtime pain points for landlords: the city’s tenant purchase law and eviction policies. But the compromise left tenant advocates fuming and Bowser only partly satisfied.
The centerpiece is a retooling of the Tenant Opportunity to Purchase Act. The council’s version shortens the window of exemption to the law for newly-constructed buildings to 15 years — down from the 25 years Bowser originally proposed — but keeps her proposed carveout for owners who sign 20-year affordability agreements. That alone could loosen one of the region’s biggest levers on multifamily investment.
The bill also trims eviction timelines, aiming to fast-track removals in violent crime cases and shrink the prefiling and hearing periods in nonpayment cases. The changes come amid heightened concern from landlords over rising rent arrears and a sluggish recovery in construction, which has cooled under regulatory uncertainty.
COMMERCIAL: OFFICE LEASING
In the second quarter, Washington, D.C.’s office vacancy rate climbed to 20.2 percent as occupancy fell by 286,000 square feet — in large part due to the drop in federal leasing and federal agencies and nonprofits awaiting clarity on future budgets, according to a report from commercial real estate services firm JLL.
Class A properties fared better than Class B/C buildings. The vacancy rate for trophy assets fell to 13 percent while rents rose to $92 per square foot.
The second quarter did not see any contractors breaking ground on new office projects, though there are two properties under construction — and they are 66 percent preleased, per JLL.
PHILADELPHIA
RESIDENTIAL: SALES
In Philadelphia in July, the median home sold for $275,000, flat from the year before, according to data from brokerage firm Redfin. About 26 percent of houses there are selling above ask, though 32 percent sell with discounts.
Homes are lingering on the market in the city for a median of 47 days — six days longer than last year.
Activity also is down, as 1,264 homes sold in Philadelphia in July, compared to 1,369 the year before, per Redfin.
RESIDENTIAL: RENTALS
In Philadelphia as of Aug. 11, the average rent was $1,625, down $25 from the month before, according to real estate listings platform Zillow. Compared to the year before, the average rent in the City of Brotherly Love is $16 higher.
Overall, the rent in Philadelphia is 23 percent lower than the national average of $2,100.
DEVELOPMENT
Philadelphia’s main transportation authority is putting out a call to developers for a mixed-use project oriented around one of its stations.
SEPTA released a request for proposals for a new development on a three-acre parking lot next to the Ambler train station, the Philadelphia Business Journal reported. The parking lot at 35 West Butler Pike was identified by SEPTA and Ambler Borough as the ideal spot for the new development.
The zoning for the site allows for up to 35 units per acre, which could be expanded to 50 units per acre if bonus requirements are met. In all, a development could house up to 170 units, as well as ground-floor retail. There are additional requirements for sidewalks and open space.
COMMERCIAL: OFFICE LEASING
For the third quarter in a row, the office vacancy rate in Philadelphia in the second quarter fell, coming in at 19.5 percent, according to a market report from commercial real estate services firm Colliers. However, this rate is still higher than it was the same time last year, when it was 18.8 percent.
Asking rents also rose in the second quarter, to $30.34 to $30.09 the quarter before and $30.23 the year before.
Overall, leasing activity in Philadelphia during the second quarter was focused largely on trophy properties, per Colliers. Rising construction costs are likely to hamper the market further, and if tenants are looking to renovate lower-grade properties, landlords are likely going to be looking to ink long-term deals.
ATLANTA
RESIDENTIAL – SALES
Metro Atlanta just logged a historic reversal. More people moved out than moved in over the past year, marking the first net loss of domestic migration for the region in at least three decades, according to the U.S. Census Bureau.
The decline, a modest 1,330-person dip from mid-2023 to mid-2024, signaled a potential inflection point for one of the Sun Belt’s longtime growth engines.
Housing affordability has become a key pressure point.
Atlanta’s home values have tripled since 2012, according to Zillow, and now exceed the national average, pricing out many would-be buyers. Census and Bank of America data suggest the pattern is playing out across other big Sun Belt metros as well, including Phoenix, Dallas and Tampa, where pandemic-era growth has cooled sharply.
In July, the average home value in Atlanta was $396,813, which is 4.6 lower compared to July 2024, according to listings platform Zillow.
About 22 percent of homes are selling for over ask, as of the end of June, while 57 percent of properties are getting discounts, per Zillow. Meanwhile, the median days a home goes into pending is 48 days.
RESIDENTIAL – RENTALS
In Atlanta, the average rent in July was $1,773, with the average apartment spanning 971 square feet, according to RentCafe.
Atlanta’s average rent is in line with the national average and has held relatively steady year over year.
Renters also make up 54 percent of the housing market in the city, according to the listings platform.
The priciest neighborhoods are: Garden Hills, with an average rent of $2,574; Midtown Atlanta, with an average rent of $2,552; and South Tuxedo Park, with an average rent of $2,480.
DEVELOPMENT
One of metro Atlanta’s largest planned developments is a step closer to starting construction.
Henry County commissioners approved a rezoning and development agreement with Florida-based Geosam Capital, greenlighting a 1,278-acre master-planned community dubbed “The Grove,” just off U.S. Highway 41 near EchoPark Speedway in Hampton, the Atlanta Business Chronicle reported. The megaproject includes over 6,100 residential units, 670,000 square feet of retail and restaurants and 1.3 million square feet of office and institutional space.
The community will also feature a commercial hub with a 180-room hotel and a potential Piedmont Healthcare facility, according to earlier filings. Full buildout could take as long as 40 years.
COMMERCIAL – OFFICE LEASING
Office leasing was steady in Atlanta during the second quarter, with tenants inking deals for 1.9 million square feet of space, according to a report from commercial real estate services firm Savills.
However, that figure is slightly down from the quarter before, which saw 2.2 million square feet of leasing activity.
The availability rate fell 130 basis points year over year to 27.9 percent, while asking rents climbed by 3.7 percent to $33.81 per square foot. In the central business districts, rent growth was slower year over year, increasing by 1.9 percent to $40.95.
The top lease signed in the second quarter was Boehringer Ingelheim, a pharmaceutical company, taking 73,900 square feet at 11650 Johns Creek Parkway in North Fulton.
TAMPA
RESIDENTIAL – SALES
In July, the median sale price in Tampa was $437,000, which is 4.6 percent lower compared to the same time last year, according to real estate brokerage Redfin.
On average the average home in Tampa sells about 3 percent under ask, and enters pending in about 36 days, per Redfin. Almost 12 percent of homes go above ask, which is 6.6 percent fewer homes than last year. Nearly 39 percent of homes — 1.4 percent more than last year — are trading with discounts.
One percent of homeowners in the U.S. searched Redfin looking to move to Tampa, with most of those searches stemming from New York. Meanwhile, 63 percent of Tampa owners searched to stay in that metro area.
RESIDENTIAL – RENTALS
In Tampa, where there are just over 2,700 available rentals, the average rent for apartments of all types was $2,150 as of mid-August, according to listings platform Zillow.
That’s $49 lower month over month, but $50 higher year over year.
Tampa’s average rent is close to the national average, just 2 percent higher.
One-bedroom apartments are leasing for an average of $1,600 a month, down $7 month over month and $3 year over year. Two-bed units are renting for an average of $1,895 a month, which is $16 lower compared to July but $45 higher compared to the same time last year.
DEVELOPMENT
As of May, there were eight projects under construction in Tampa’s downtown area, according to the Tampa Downtown Partnership.
These projects plan to bring 1,447 residential units and 220 hotel rooms to the area. The projects total 167,000 commercial square feet, though the total construction underway is 4.1 million square feet.
Another 7.6 million square feet across 16 projects are in the final planning stages or are being proposed.
One recently completed project is the 32-story AER Tampa, which has 334 apartments and about 16,000 square feet of commercial space.
The largest project under construction in Downtown Tampa is the renovation and expansion of the Straz Center, which will be four stories tall and span just under 60,000 square feet, according to the partnership’s report.
COMMERCIAL – OFFICE LEASING
In Tampa during the second quarter, the office vacancy rate ticked up 130 basis points year over year to 17.2 percent, according to commercial real estate services firm JLL. Meanwhile, total available space hit a multi-year low.
The Tampa Bay office market also has new developments underway, with more than 94,000 square feet under construction, with about 53 percent of that space already leased.
Year to date, net absorption in the market was about 111,000 square feet, and the asking rent was $31.57 per square foot, driven by rental increases for trophy properties.
ORLANDO
RESIDENTIAL – SALES
Home prices were up 4.8 percent in Orlando in July, according to brokerage Redfin. The median sale price was $434,000.
Homes sold on average after 52 days on the market, close to double the 29 days it took on average at the same point last year. Additionally, fewer homes traded in July — 268 compared to 384 last year.
In July, just over 11 percent of homes sold above ask, a figure 6.6 percent lower than last year. Meanwhile, a little more than 35 percent of houses traded with price chops, which was 1.3 percent fewer homes than last year.
RESIDENTIAL – RENTALS
The average rent in Orlando was down in July compared to the year prior, according to Rent.com.
An average studio was going for $1,679, which was 1 percent lower than last year. One-bedrooms on average were renting for $1,409, down 19 percent. And two-bedroom units had an average rent of $1,795, a 15 percent decrease year over year.
The priciest rents were in the Lake Eola Heights neighborhood, where a one-bedroom unit went for $2,557 on average in June — up 60 percent year over year, which also is the greatest increase among Orlando’s neighborhoods.
Engelwood Park recorded the greatest yearly drop in average rent of 34 percent. A one-bedroom apartment there rents for an average of $1,280 a month.
DEVELOPMENT
As office-to-residential projects proliferate across the country in response to a decaying office sector, one Orlando suburb is mastering the art of a different kind of conversion.
Kissimmee, about 30 minutes south of Orlando, leads the nation in hotel-to-residential conversions, with eight hotels being transformed into 1,888 apartment units, the Orlando Business Journal reported, citing RentCafe. Many of the Kissimmee projects are geared toward affordable or supportive housing.
Additionally, Aventon Companies wasted no time turning dirt for a multifamily development near Orlando International Airport after buying the property last month.
The North Carolina-based firm, led by Thomas Keady, has started construction on Aventon Lake Conway, a 346-unit apartment complex on Hoffner Avenue, the Orlando Business Journal reported.
The project adds to a flurry of multifamily development in the area around the airport, which is about 25 minutes southeast of downtown Orlando. Since 2019, the area north of the airport has seen its apartment stock rise by 32 percent, with 1,915 units built. Eight more projects, totaling 2,570 apartments, are in the pipeline.
COMMERCIAL: OFFICE LEASING
Office leasing volume ticked down 0.3 percent quarter over quarter to 499,000 square feet in Orlando in the second quarter, according to commercial real estate services firm Cushman & Wakefield. That’s the lowest total over the past year.
Activity in the Lake Mary/Heathrow submarket comprised about a quarter of the deals, though the area has just 12 percent of the market’s inventory. The market recorded the largest lease for the quarter: Abbott taking 66,300 square feet at 1101 Greenwood Boulevard. Activity in the central business district fell more than 48 percent compared to a year ago, to 182,100 square feet.
The vacancy rate was stable compared to the quarter before, coming in at 16.8 percent. Rents were also stable, with the average asking rent at $27.52 per square foot in the second quarter.
CHARLOTTE
RESIDENTIAL: SALES
In Charlotte, homes sold for 3.7 percent higher prices in July compared to the year before, with the median sale price clocking in at $438,000, according to brokerage firm Redfin.
Buyers snapped up homes in July in an average of 47 days, a week longer than the same time last year. July also saw fewer transactions year over year: 1,019 compared to 1,047.
Meanwhile, 22.2 percent of homes are trading above their listing prices, which is 5.2 percent fewer properties compared to the prior year. And 33.8 percent of homes are selling in Charlotte with discounts — 1.9 percent more than last year.
RESIDENTIAL: RENTALS
The average rent in Charlotte in August was $1,485, for an apartment spanning an average of 750 square feet. The average rent ticked down 0.6 percent year over year, according to Apartments.com. That works out to $9 less per month.
The average Charlotte two-bedroom pad rents for $1,788 a month, and $2,224 a month is the average rent for a three-bedroom apartment.
DEVELOPMENT
Charlotte’s city center has some $4 billion worth of projects in the pipeline, according to Charlotte Center City Partners.
One project under construction is the fourth office building at the Legacy Union site at 600 South Tryon Street. The tower will stand 24 stories tall and have Robinson Bradshaw as its main tenant. The project will have 440,000 square feet of office space and 20,000 square feet of retail space.
Also underway is the Queensbridge Collective 42-story tower. The project will have market-rate apartments and restaurants, according to the Charlotte Observer.
Several major infrastructure projects are also in the works, including the $249 million widening of N.C. 150 at Lake Norman, per the Observer.
COMMERCIAL: OFFICE LEASING
In Charlotte during the second quarter, the office market saw 0.9 million square feet of leasing activity, which was the highest total for a quarter in the past five years, according to commercial real estate services firm Savills.
Availability during the quarter came in at 25.3 percent, which was 100 basis points lower compared to the same time last year but 60 basis points higher compared to the quarter before.
Asking rents for Charlotte office space climbed 1.5 percent year over year to $33.46 per square foot. Class A asking rents rose more — by 1.9 percent annually — to $48.45 in the second quarter.
Meanwhile, tariff uncertainty has led developers to build mixed-use properties that combine office, retail and multifamily. The Queensbridge Collective, for instance, is set to start construction by the end of the year.
NASHVILLE
RESIDENTIAL: SALES
In July, Nashville home prices rose 1.8 percent year over year, according to brokerage firm Redfin, with a median price in the city of $480,000.
Buyers purchased homes in an average of 62 days, which is 10 days longer than the same time last year. However, July saw more deals compared to last year: 966 versus 905.
About 13 percent of homes in Nashville sold above ask, which is 6.2 percent fewer properties than the year before. Meanwhile, discounted sales rose to nearly 34 percent, a 5.1 percent year-over-year surge.
RESIDENTIAL: RENTALS
Millionaire renters are flocking to ultra-luxury apartment rentals in downtown Nashville as oversupply in the rest of the market has kept the vacancy rate high.
A development boom starting in 2020 delivered nearly 26,000 apartments across the city, including almost 9,000 downtown, and with so many projects hitting the market at once, thousands of units are vacant, the Tennessean reported.
More than 4,300 available rentals sit empty within the city’s core, including hundreds at large projects like The Reservoir, Olive at Peabody Union and the Chartwell at Marathon Village, according to an analysis by the outlet and RentCafe.
While developers and landlords wait for absorption to catch up, a niche sliver of the market is already filling fast: ultra-luxury rentals preferred by millionaire tenants.
Nashville now counts 30 households earning $1 million or more per year who rent, up from none in 2019, the outlet reported. The vast majority of Music City’s 928 millionaire households still own their homes, but an ever-increasing number are opting for flexible, “turnkey” rental lifestyles.
Meanwhile, as of mid-August the average rent in Nashville was $2,275, a $25 drop from the month before but a $25 increase compared to the year prior, according to Zillow. There are more than 3,100 available units on the market.
DEVELOPMENT:
Tennessee House Speaker Cameron Sexton questioned the authority of Nashville’s East Bank Development Authority, which is charged with overseeing one of the largest redevelopment efforts in the city’s history, the Nashville Business Journal reported.
“How much authority does this authority have?” he asked in a board meeting this week.
The group was created by the state legislature earlier this year to oversee redevelopment of Metro-owned land near the $2.1 billion Tennessee Titans stadium, which is under construction.
Concerns are rising among state lawmakers over Metro Nashville’s control of the broader East Bank plan, where significant infrastructure work is needed for the 500-acre megadevelopment.
Who ultimately controls land use, zoning, infrastructure and design decisions for East Bank cannot be answered in a word.
The development authority only has power over 30 acres of the land, which Fallon is developing and is subject to a master plan. Metro has not yet transferred the rest of the acreage to the development authority’s control, said Tom Cross, Metro’s legal deputy director.
Fallon has proposed substantial design changes that would fall under the East Bank Development Authority’s approval, and not Metro’s, after the development agreement and properties are transferred, Cross said. The transfer could happen in late summer or early fall.
Until then, the authority can only influence design decisions, the group’s recently appointed CEO Ben York said.
Meanwhile, Oracle filed to rezone a portion of its East Bank holdings in Nashville, a move that signals incremental progress on what’s expected to be the company’s future world headquarters.
The tech giant submitted documents last week to the Metro Planning Department requesting to rezone 9 acres of its River North property from industrial use to “mixed-use intensive,” a category that allows for residential, office and retail development, the Nashville Business Journal reported. The rest of Oracle’s land is already zoned for such uses.
COMMERCIAL: OFFICE LEASING
Federal downsizing isn’t over, and in Nashville, what’s left on the table could reshape the office market.
More than 400,000 square feet of the federal government’s office leases in Nashville could be terminated by the end of next year, posing a fresh threat to a market already grappling with high vacancies and shifting tenant demand, the Nashville Business Journal reported.
The U.S. General Services Administration has 20 leases spanning 650,000 square feet across the metro. So far, it has canceled three leases spanning 25,000 square feet, according to Avison Young.
That includes a 14,000-square-foot lease for the Food and Drug Administration, 6,000 square feet for the National Park Service in Gallatin and 4,000 square feet for the Social Security Administration in MetroCenter.
More cuts are likely coming.
Roughly 411,000 square feet of federal office space in the region will be in “soft-term” status by the end of next year, meaning it can be terminated with minimal notice, Avison Young said.
Office vacancy in Nashville reached 22.5 percent last quarter, with leasing activity picking up slightly due to a construction slowdown and growing demand for Class A space, according to JLL. But the impact of GSA exits could ripple across older, lower-tier buildings.
PHOENIX
RESIDENTIAL: SALES
In Phoenix during the second quarter, home prices climbed 3.4 percent year over year, putting the median sale price at $455,000, according to brokerage firm Redfin.
However, homes are taking longer to sell. On average, buyers are snapping up properties after 63 days on the market, 15 days more than last year. Fewer deals also were done in July, which saw 1,337 sales compared to 1,488 the year before.
Almost 15 percent of homes are selling above ask, about 5 percent fewer than last year. Meanwhile, the share of homes trading with discounts rose by 0.9 percent year over year, to 34.7 percent.
RESIDENTIAL: RENTALS
In the second quarter, the average rent for an apartment was $1,556 a month, down 2.8 percent year over year, according to real estate firm MMG Real Estate Advisors.
However, the occupancy rate fell compared to the year before. In the second quarter, the rate was 91.5 percent, 50 percent lower than the second quarter of 2024.
Phoenix’s supply and demand were better aligned in the second quarter, per MMG. Still, the market has about 20,000 units under construction, which represents nearly 5 percent of inventory.
DEVELOPMENT:
Developers in Pinal and Maricopa counties could get the green light to build new housing using water rights from retired farmland.
On June 19, the Arizona state Senate passed S.B. 1611, a so-called “ag-to-urban” proposal that would purportedly allow urban expansion while creating water savings and maintaining water security, The Arizona Republic reported. The bipartisan bill passed with a 26-4 vote and was sent to the House.
Under the new law, farmland owners in groundwater-regulated areas of Pinal and Maricopa counties can give up their groundwater rights in exchange for credits they can sell.
It would be a boon to developers, as they’ve been banned since 2023 from building in the Phoenix or Pinal Active Management Areas if they’re tapping these shrinking aquifers. The requirement to prove access to 100 years’ worth of sustained water supply prompted a lawsuit against Hobbs from the Home Builders Association of Central Arizona earlier this year.
Additionally, Peoria has big plans to turn nearly 7,000 acres of land into a state-of-the-art innovation hub.
The Phoenix suburb is looking to purchase 834.5 acres at an Arizona State Land Department auction on Aug. 27, the Phoenix Business Journal reported. The bidding starts at $46.7 million, according to the Business Journal.
Last December, the Peoria City Council voted to sign an agreement with the Arizona State Land Department to develop 6,700 acres in the northern reaches of the city near Lake Pleasant. There, the planned Peoria Innovation Core would rise, bringing residential, retail, offices and open spaces to the shovel-ready land.
As part of the partnership with the Arizona State Land Department, the city of Peoria would lead the planning efforts for nearly 7,000 acres of future development. As master planner for the Peoria Innovation Core, the city will lead zoning and entitlement efforts as well as design and construction for public infrastructure like the arterial roadway system and underlying utilities for future development.
To kick things off, the city plans to invest $140 million into backbone infrastructure for the area. The goal with the Innovation Core is to attract commercial developers and major employers to Peoria, according to the Business Journal.
COMMERCIAL: OFFICE LEASING
Golf hospitality management company Troon just inked the year’s biggest office lease in the Phoenix area.
The Scottsdale-based golf and golf-related hospitality management company will move its headquarters to a 68,700-square-foot space on the top floor of Inisio Kierland II, one of two buildings at the 415,600-square-foot Inisio at Kierland office complex at 16430 North Scottsdale Road, the Phoenix Business Journal reported. The deal marks the largest office lease in the Valley so far this year.
Despite such a large deal, the vacancy rate for office space in Phoenix rose to 22.05 percent in the second quarter from 21.83 percent the quarter before, according to real estate firm Lincoln Property Group.
Rents, however, also rose, to $31.63 in the second quarter from $30.20 in the first quarter.
Overall the Phoenix office market has about 314,000 square feet under construction.
SEATTLE
RESIDENTIAL: SALES
Home prices were flat year over year in Seattle during the second quarter, according to real estate brokerage Redfin. The median sale price for the city was $880,000.
Homes lingered on the market longer in the second quarter compared to the same last year — 18 days compared to just 12. However, Seattle saw more deals — 807 — in the second quarter, versus 788 the year prior.
A smaller share of homes are trading above their listing price, per Redfin. Under a quarter of properties — some 6 percent less than last year — sold above ask. Meanwhile, more homes are selling with price chops. About a third of homes traded with discounts, up 2.5 percent year over year.
RESIDENTIAL: RENTALS
Seattle’s multifamily market was just under 96 percent occupied in the second quarter, up 0.6 percent from the first quarter, according to commercial real estate services firm CBRE.
Rents also were higher, by 1.4 percent, with the average rate at $2.236 per unit per month.
A smaller number of new units came online in the second quarter — 1,524 — compared to the first, which saw 1,726 units delivered. Meanwhile, 4,110 units were absorbed in the second quarter, more than 2,000 more than in the first quarter, thanks to continued demand by tech company expansions and return-to-office mandates.
Also on the rental front: in June the Seattle City Council voted unanimously to ban all software that gathers information from properties and uses the data collected to recommend rent prices to landlords, The Seattle Times reported. This includes websites like RealPage, which has fielded a flurry of lawsuits in recent years.
Under the new law, any service that compiles current and past rents, occupancy rates and other data from private or public sources and then uses an algorithm to recommend rent prices to more than one landlord would be prohibited. It would also stop Seattle landlords from subscribing to or contracting with those services, and would permit either the city attorney’s office or tenants to seek $7,500 per violation.
DEVELOPMENT
Seattle’s design review process could get a major overhaul if Mayor Bruce Harrell gets his way.
In June, Harrell proposed a swath of reforms to the city’s design review process that could cut the permitting time for most new housing developments by up to two years, the Puget Sound Business Journal reported.
Under the new system, only large construction projects would be subject to design review, and the threshold for building size would increase to 150 or more housing units or 20,000 or more square feet of commercial space.
To streamline approvals, one citywide 14-member board would replace the eight separate boards covering different parts of the city. The new board would be composed of design, development and equity experts with the goal of better reaching historically underserved communities.
The changes, Harrell said, would reduce the number of projects subjected to design review by up to 40 percent in any given year. That would, in turn, decrease permitting time for most new housing projects by one to two years.
Projects that go through the new design review process would shave off an average of four to nine months. Part of that includes limiting design review to one meeting instead of two or more.
An analysis by the city found that a project can take as long as two years to complete the process.
COMMERCIAL: OFFICE LEASING
Return-to-office mandates continue to help Seattle’s office market recover.
Though the market’s vacancy rate rose to 32.4 percent in the second quarter, the yearly growth slowed from 7 percent in 2021 to 3.2 percent in the second quarter. according to a report from commercial real estate services firm Colliers.
However, net absorption was still negative, at -732,000 square feet. Class A rents in Seattle’s central business district tumbled by 2.2 percent year over year, to $54.81, thanks to this increased supply.
One large lease inked was the Casey Family Programs’ leasing of 79,000 square feet of space at 800 Fifth Avenue. Stackline also inked a 45,000-square-foot sublease at Madison Centre.
DENVER
RESIDENTIAL: SALES
In Denver, last month, the median home sale price fell year over year by 3.4 percent to $570,000, according to brokerage firm Redfin, bucking a national trend of rising housing prices this summer.
Homes are also staying on the market longer than they had been last year. On average, homes are trading 35 days, compared to 25 last year. The number of transactions also dropped in July from the year before, to 842 from 891 deals — a 5.5 percent drop.
The percentage of homes that traded above ask in July fell by about a quarter of a percent to 19.7 percent, per Redfin. Meanwhile, the share of deals with discounts grew by 0.8 percent year over year to almost 46 percent.
RESIDENTIAL: RENTALS
In the second quarter, Denver’s average rent was 418,24, a 3.8 percent decline from the year before, according to data from real estate firm MMG Real Estate Advisors.
The occupancy rate for apartment units also fell, by 180 basis points year over year to 91.8 percent.
Supply outweighed demand, as almost 6,000 apartments were absorbed in the first half of the year and nearly 8,000 units were delivered.
DEVELOPMENT
Denver’s River North Art District could see the transformation of a historic property that incorporates century-old buildings into a new development.
In July, the Denver City Council’s Community Planning and Housing Committee heard a rezoning request and accompanying development agreement to turn the former Denver Rock Drill Manufacturing Company into a mixed-use development including housing, office, retail and hotel space, the Denver Business Journal reported.
Local entrepreneur Byron Weiss acquired the 6.7-acre site, once used to produce pneumatic drills that were used in the mining industry, in 1992 for his Porta Power warehouse supply company. A few years later, he added housing to the area in the form of the 30-unit Lofts at Denver Rock Drill Works.
The proposal calls for a mix of residential, office, retail and hotel uses on the site. That may include 600,000 to 850,000 square feet of residential space, 40,000 to 60,000 square feet of office space, 100,000 to 150,000 square feet of mixed retail and 100,000 to 130,000 square feet for a hotel. In total, the site could see up to nearly 1.3 million square feet of development.
Elsewhere in the city, two new apartment towers are set to transform the skyline near the Denver Tech Center district.
Construction has begun on the Belleview Station development site set to house twin 21-story and 22-story apartment buildings, the Denver Business Journal reported. The towers will add 634 residential units to the property, according to plans submitted to the city.
The towers will be built in phases, and ground has broken on the 22-story tower with construction expected to take years, Trey Warren, vice president of Belleview Station, told the Business Journal. The 22-story building will include 320 apartments and a rooftop pool. The second 21-story tower will include an approximately 11,000-square-foot market, 314 apartment units, a hot tub and an outdoor kitchen.
Construction also has begun on a $7 million taxiway, dubbed Taxiway K, at Rocky Mountain Metropolitan Airport in Broomfield, the Denver Business Journal reported. The project includes 1,800 feet of taxiway that would eventually connect to hangars built by private developers hosting various businesses, airport director Erick Dahl told the Business Journal.
The airport isn’t necessarily looking for more aircraft to populate the hangars. Instead, it’s looking for other tenants, such as those that provide maintenance, repair and overhaul services for aircraft. Currently, RMMA hosts hangars for aircraft like government planes, private and corporate jets as well as four flight schools.
Construction on the new taxiway is expected to be completed by the end of the year. Once that’s done, RMMA will put out a call for proposals for a mix of tenants. The regional airport already has a years-long waitlist for people who would like to use the T-hangars on site for small aircraft.
COMMERCIAL: OFFICE LEASING
Denver’s office market struggled in the first part of the year.
The vacancy rate for the sector ticked up by 50 basis points in quarter over quarter to 27.4 percent. Compared to the year before, vacancy was up 140 basis points, according to a report from commercial real estate services firm CBRE.
Absorption also remained negative, coming in at -442,000 square feet in the second quarter — though that was an improvement from the -851,000 square feet of absorption in the first quarter.
Quarter over quarter, office sales also dropped. In the second quarter, there were eight transactions that totaled $111.5 million, down from $153.3 million for three deals in the first quarter.
LAS VEGAS
RESIDENTIAL: SALES
Home prices in Las Vegas tumbled 2.2 percent year over year in July, according to brokerage firm Redfin, putting the median price at $440,000.
Sin City homes are also lasting longer on the market — selling in an average of 56 days compared to 37 last year — and fewer deals are getting done. Last year, there were 955 transactions in July. This year, there were 765.
About 15 percent of homes traded above ask, down 8 percent from the same time last year. About 32 percent of homes recorded price drops — up more than 3 percent year over year.
RESIDENTIAL: RENTALS
The average apartment rent in Sin City in the second quarter came in at $1,474, down 1 percent from the same time last year, according to real estate firm MMG Real Estate Advisors.
Class A rents dropped the most thanks to increased competition from new developments, per MMG.
The multifamily occupancy rate also dipped down, by 30 basis points year over year, to nearly 92 percent, as some 2,700 apartments hit the market in the first half of the year. Meanwhile, just over 2,400 units were absorbed — well above the city’s 10-year average.
DEVELOPMENT
Casino boss Derek Stevens gambled on buying part of a former railyard in downtown Las Vegas, and now holds the last cards for its redevelopment.
But Stevens, who owns three hotel-casinos downtown, won’t reveal his hand and what he wants to do with his 6.4 acres of dirt within the 61-acre region known as Symphony Park at Grand Central Parkway at Bonneville Avenue, the Las Vegas Journal-Review reported.
His lot, the last undeveloped chunk of Symphony Park, is separated by train tracks from the parking garage at his soaring Circa resort.
Mayor Shelley Berkley said in her recent State of the City address that a Stevens-built casino in Symphony Park is “in our future.” A city website proclaims, “Stay tuned for more details.”
But Stevens, who plays a long game, said not so fast. He wants to see other projects near the property he bought in 2017 take shape first.
“When you see all of these other projects coming to fruition … that’s going to help form, in my mind, what needs to go on to our property,” he told the Review-Journal late last month on the day before Berkley’s speech.
Either way, he’s got a high-stakes development opportunity.
COMMERCIAL: OFFICE LEASING
Tenant demand for office space in Las Vegas fell in the second quarter, as net absorption came in at about 31,300 square feet, according to commercial real estate services firm CBRE.
Still, the city’s vacancy rate for the sector was 12.2 percent, a 70-basis-point rise from the same time last year.
As for rents — the city’s average fell to $2.62 per square foot from $2.65 per square foot from the quarter before.