Tri-Cities commercial sales increase, sales volume down

All too often the public perception of real estate is one-dimensional. The residential side of the business gets most of the attention. But there’s more to the real estate story. Commercial real estate is critical to the local economy even if it’s not in the spotlight.

The Northeast Tennessee Association of Realtors® commercial real estate mid-year report offers some facts, and numbers, that often go unnoticed by the public. For instance, During the first six months of this year there were 274 completed commercial sales. Those transactions – as measured by title transfers – were worth $103.3 million. That was a little over $50 million less the first half of last year even though there were more transactions this year. The biggest commercial sales so far this year was the $20 million sale of the Monarch Apartments in Johnson City and the sales of the Bristol Va. Court Yards by Marriott for $13.7 million.

Part of the data for NETAR’s mid-year commercial report comes from third-party sources. For example, the commercial sales numbers came from the Appalachian Highlands Dashboard for Real Estate Analytics, a new enterprise by Don Fenley, supported by TechPoint’s Austin Ramsey, TCI Group’s Nina Heffner, and underwritten by Jerry Petzoldt, TCI Lifestyle Investments.

An internal source for commercial lease transactions was the NETAR Commercial Multiple Listing Service (CMLS). It shows leases transactions were a 33.3 percent improvement over last year. It was the best half-year showing since 2015. NETAR’s CMLS transactions do not include lease data from other commercial listing services.

And then there were the new commercial building permits from The Market Edge in Knoxville. That report listed a total of 267 new permits during the first half of the year compared to 213 last year. Sullivan and Washington counties – the region’s largest markets – accounted for the lion’s share of new permits, while Greene Co. Tenn. and Washington Co. Va. saw noteworthy increases in the number of permits. The Washington County market saw the highest construction value gain from mid last year - up $22.3 million – while the Sullivan County increase was $8.9 million. Together new permits for those two counties totaled $83.5 million.

The full mid-year report, which includes market assessments from a panel of NETAR members who are commercial practitioners can be found at on the NETAR website in the Commercial Real Estate category that’s linked to the top of the page.