Secondary Markets CRE Professionals are Watching in 2018

Secondary Markets CRE Professionals are Watching in 2018

It is widely agreed that there are six primary markets in the real estate sector. Those cities are New York City, San Francisco, Washington D.C, Chicago, Los Angeles, and Boston (a few experts consider Dallas and Houston to be members of this group as well). While there certainly more than six cities flourishing since the 2008 recession, these aforementioned metros are unrivaled when it comes to population, the number of transactions, and impact on the economy. But opportunities in these cities are also very competitive and expensive for commercial real estate businesses. This is why more and more investment is being placed in up-and-coming secondary markets.

So what defines a secondary market?

Traditionally, a secondary market is a mid-size city that is experiencing incremental growth year-over-year. That growth includes things like improvements to the local economy, rising populations of young professionals and families, new businesses being created, and existing businesses looking to expand. All of the above will be reflected in decreasing office space vacancies, fewer multifamily vacancies, and strengthening of the housing market. Despite vacancies being lower and the housing market getting more competitive, cost of living and of doing business remains considerably less than primary market cities.

Now that we have defined what a secondary market is, what are some top cities that excite commercial real estate groups and investors the most in 2018?


*These cities are listed in alphabetical order and not ranked against each other

Austin, Texas

Austin is the #1 fastest growing city in the country according to WalletHub. , with the majority of those being educated college graduates moving to the city because of the newly available job opportunities and the. low cost of living. PWC and the Urban Land Institute (ULI) rank it as the #4 local economy in the U.S. and Business Insider places it as #6 on the list of top 10 hottest housing markets of 2018.

Charleston, South Carolina

Charleston’s local economy comes in at #11 in the US according to PWC and ULI and is the 20th fastest growing city in the country. The Charleston Region is already home to Mercedes-Benz Vans and Boeing and continues to attract big players in the manufacturing industry. Additionally, Volvo is in the process of building a $500 million facility northwest of the city.

Charlotte, North Carolina

The Queen City checks in at #4 on the 10 hottest housing markets of 2018 and #2 on the fastest growing large cities in the US. Charlotte has been on a meteoric rise over the past decade. It became home to the nation’s 3rd largest banking center with Bank of America, and BB&T is placing their headquarters there as well.

Dallas, Texas

Dallas claims the #2 economy in the US according to PWC and ranks #2 on’s list of “10 U.S. Housing Markets That Will Rule 2018”. The city experienced 3.8% year-over-year job growth in 2017, which is second to only Atlanta (3.9%). Dallas has invested extensively in updating their reputation as a “cultural desert” that is home to only cowboy hats and Big Oil. Some of these measures include developing the country’s largest art district and investing $150 million into downtown parks.

Denver, Colorado

Called the #3 fastest growing city in the US by WalletHub, Denver is a logistical dream for many businesses. It is almost directly in the center of the country, making travel to either coast easier. Denver has become a haven for startups and established companies alike, with many believing it to be the next great tech mecca. Curbed includes Denver on its list of 9 real estate markets to watch in 2018.

Nashville, Tennessee

Nashville is the 5th fastest growing city in the US, with investor demand outpacing current supply within the market (PWC). The area experienced population growth of 2.24% and job growth of 3.07% in 2017. The country’s music capital has low housing prices, a pro-business environment, and a booming tourism industry that make it a very desirable market in 2018.

Portland, Oregon

Portland is home to the likes of Nike and Intel. Its increasing population has caused a bit of a housing crisis, which is why it finds itself ranked as the 4th highest rent growth city in the US. Rent increased by 6.1% in 2017 alone. This also explains why Portland is #11 on the list of top multifamily property investment prospects according to PWC. There is also a high demand for affordable housing in Portland.

Raleigh, North Carolina

Raleigh is an intriguing place to operate a business nowadays. Young, educated professionals are moving into the city in large numbers, and its numerous colleges and university provide a steady stream of new talent. Cushman & Wakefield believes the Raleigh/Durham/Chapel Hill area to be the 5th best place to go for high tech jobs in the US. Raleigh is #1 on the list of best places for first-time home buyers, has the 8th best local economy, and is #4 on PWC’s “U.S. Markets to Watch in 2018 – Overall Real Estate Prospects” list.


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