Key Takeaways
- • CrowdStreet ranks Austin, Texas as the top commercial real estate investment market for 2022 in its annual Best Places to Invest report, followed by Raleigh-Durham, Nashville, Orlando and Seattle.
- • The report ranks markets on 28 indicators spanning micro- and macroeconomics, quality of life and taxes, and breaks out best markets across seven sectors: multifamily, build-to-rent, industrial, office, hotel, retail and life sciences.
- • Los Angeles tops CrowdStreet's 2022 industrial ranking, with Orange County, Seattle, Inland Empire and San Francisco-Oakland following, supported by razor-thin vacancy and rent growth.
- • Multifamily rents rose an average of 11% year-over-year in 2021 per CoStar, the highest annual increase on record.
- • CrowdStreet reports its platform has committed more than $2.8 billion from investors, including over $1.2 billion of equity in 2021, with an average realized 18.6% IRR across 80 fully realized deals.
Summary
CrowdStreet, a real estate investing marketplace, has released its annual Best Places to Invest report for 2022, naming Austin, Texas the top market for commercial real estate investing overall. Raleigh-Durham ranks second, Nashville third, Orlando fourth (up from 18th) and Seattle fifth (up nine spots). According to CrowdStreet's Chief Investment Officer Ian Formigle, a market must rank consistently high across multiple property classes to make the top 20. The rankings draw on 28 indicators covering economics, quality of life and taxes.
Austin, which finished second in 2021, has seen its population grow 21% over the last decade, driven by tech employers including Tesla, Oracle and Google. CrowdStreet ranks it first in build-to-rent and retail, second in office and multifamily, and third in multifamily among the sectors it covers. Raleigh-Durham, with more than 750,000 residents in the 2020 census, has grown 23% since 2010, according to the report, and CrowdStreet cites it as the nation's top multifamily housing market. Nashville leads CrowdStreet's office space ranking. Orlando's 2021 multifamily demand drove 23.1% annual rent growth, per the report.
Industrial and life sciences are highlighted as sectors benefiting from pandemic-driven demand. Los Angeles leads the industrial ranking, followed by Orange County, Seattle, Inland Empire and San Francisco-Oakland. CrowdStreet cites warehouse vacancy rates of 0.9% in the Inland Empire and 2% in Los Angeles at year-end 2021, and a 4% industrial vacancy rate in Seattle. CBRE data cited in the report shows industrial lease prices averaging 25% above expiring five-year contract rates. CrowdStreet says it has launched nearly 600 private equity real estate offerings since 2014 and that its platform has distributed more than $417 million to investors. The report notes that past performance does not guarantee future results.
Austin, which finished second in 2021, has seen its population grow 21% over the last decade, driven by tech employers including Tesla, Oracle and Google. CrowdStreet ranks it first in build-to-rent and retail, second in office and multifamily, and third in multifamily among the sectors it covers. Raleigh-Durham, with more than 750,000 residents in the 2020 census, has grown 23% since 2010, according to the report, and CrowdStreet cites it as the nation's top multifamily housing market. Nashville leads CrowdStreet's office space ranking. Orlando's 2021 multifamily demand drove 23.1% annual rent growth, per the report.
Industrial and life sciences are highlighted as sectors benefiting from pandemic-driven demand. Los Angeles leads the industrial ranking, followed by Orange County, Seattle, Inland Empire and San Francisco-Oakland. CrowdStreet cites warehouse vacancy rates of 0.9% in the Inland Empire and 2% in Los Angeles at year-end 2021, and a 4% industrial vacancy rate in Seattle. CBRE data cited in the report shows industrial lease prices averaging 25% above expiring five-year contract rates. CrowdStreet says it has launched nearly 600 private equity real estate offerings since 2014 and that its platform has distributed more than $417 million to investors. The report notes that past performance does not guarantee future results.
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