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From the Editor: Innovating and Adjusting in an Evolving Market
In this edition, Development dives into the redevelopment of a former golf course and office park in Charlotte, North Carolina, now poised to become a vibrant mixed-use community. This ambitious project exemplifies the innovative approaches developers are taking to reimagine underutilized spaces.
Jennifer LeFurgy
The office market continues to evolve, and this issue includes a timely overview of the sector, examining how changing work trends are influencing leasing, design and demand.
In addition, Ryan Companies offers a behind-the-scenes look at its growing footprint in the data center market — a critical asset class in today’s digital economy.
We hope you enjoy the new design and layout of the magazine. Let us know!
Stay informed,
Jennifer LeFurgy, Ph.D.
Editor-in-Chief
In Brief
Notable facts and figures on the state of the commercial real estate industry, culled from media reports and other sources.
Industrial
291 Million
The number of square feet of new industrial property under construction at the end of 2024, representing a 36% decline from the year prior, according to data from Cushman & Wakefield. Bisnow reported the development pipeline of industrial properties is at its lowest level since 2018, with approximately one-third of new construction being build-to-suit projects that will come online occupied.
Office
28
The record number of new leases signed at rents above $200 per square foot in 2024 in Manhattan’s high-end office market, according to the New York Post and based on data from JLL, which also noted that 212 leases were signed for at least $100 per square foot. “The larger, $100-plus pinnacle class of 2024 accounted for an unprecedented 9.8 million square feet of space, as measured by JLL,” topping the previous high of 8.8 million square feet in 2019.
2027
The year by which vacancy in prime office buildings is estimated to return to its pre-pandemic rate of 8.2%, according to CBRE’s U.S. Real Estate Market Outlook 2025.
Technology
84%
The percentage of respondents to Ferguson Partners’ Artificial Intelligence Pulse Survey who said they are actively experimenting with or implementing AI in the real estate industry. Thirty-three real estate investment firms representing both private and public organizations, and varying in size, investment strategy and location, participated in the survey. “When asked to list the primary challenges in AI adoption, the lack of understanding of AI applications (67%) along with difficulty in demonstrating clear use cases or ROI (58%) were the most common responses from survey participants.”
Retail
$10 Billion
The approximate worth of U.S. open-air retail portfolios expected to change hands this year based on what CBRE sees in the pipeline and as reported by The Wall Street Journal. Blackstone spent $4 billion on Retail Opportunity Investments, an owner of shopping centers, this past November. The deal, scheduled to close in the first quarter of 2025, was “Blackstone’s biggest bet on U.S. retail since 2011,” according to WSJ.
Data Centers
1.8
The number of gigawatts a hyperscale-focused data center campus near Dallas could scale up to at full build-out. Provident and AREP’s PowerHouse Data Centers recently formed a joint venture to build the 768-acre campus, which would be one of the largest data center complexes in the United States. The multiphase project, scheduled to begin construction in the second quarter of 2025, will initially leverage about 500 megawatts of committed power.
Housing
1.1 Million
The average number of new units per year that will need to be built to meet U.S. housing demand from 2025-2035, according to projections from the Joint Center for Housing Studies of Harvard University. That is a drop from the current rate of 1.4 million units per year, resulting from a slowdown in household growth. The demand for new construction is expected to further decrease
to 800,000 units per year in 2035-2045.
Multifamily
11.4%
Per CoStar, the vacancy rate in the United States for high-end multifamily apartment units, which command average monthly rents of $2,139. That is double the vacancy rate for more affordable properties. The Wall Street Journal reported that in the last quarter of 2024, “only 6,700 units with average monthly rents of $1,332 were under construction nationwide, compared with close
to half a million higher-end apartments, based on CoStar data.”
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