Writer: Max Crampton-Thomas
2 min read June 2021 — Raleigh-Durham’s commercial real estate has gone through a seismic shift in terms of attraction value and innovation. In an interview with Invest:, Amy Carroll, president of TradeMark Properties, goes over the most significant changes in the region’s real estate landscape.
What is Trademark Properties’ role in the Triangle’s real estate market?
TradeMark Properties is a full-service commercial real estate firm, founded in 1984. Our founder was one of the first female executives to open her own commercial real estate firm in a male-dominated industry. Over the years, our firm has been branded as a boutique real estate firm based on relationships, reputation and community roots. We created core values that really tie into who we are and what we represent to the community. Our core values are capability, creativity, commitment to excellence, character and community. We view everything through that lens because we think it is the most important factor.
What is your take on the strength of Raleigh’s commercial real estate market?
It has been an incredible journey. Things really paused between March and July due to COVID-19. Activity started picking up in Q3 because everyone began to seek certainty. We are so lucky to be in a market that is pretty COVID-insulated. We do not rely on mass transit, nor do we have a high reliance on tourism activity. The talent pool is incredible, our housing market remains strong and our commercial real estate market remains strong as people continue to fight to invest in Raleigh. One of our latest deals received 30 offers on two flex buildings. It just shows the competition here and the strength of the market. That goes a long way in showing people things are happening again. In Wake County, December 2020 was higher than December 2019 from a sales volume standpoint.
How would you characterize the future of office space?
It’s an interesting phenomenon because last year, people were reluctant to sign multi-year renewals. Companies were afraid to project out too far. This year, we’re seeing confidence return, which we believe is absolutely related to the efficiency of rolling out the vaccines. North Carolina is 15th in the nation for distributing vaccines to their residents, which is impressive. Confidence is returning and we’re starting to sign five and seven-year leases again, which is normal for our market and what has been the minimum for both landlords and tenants.
Some companies have determined they do not need as much office space. Some companies have had success with a part of their workforce working from home, so their full workforce will not come back. These approaches are balanced out with companies whose workforce has to come back and they need more space.
What are some of the prevalent challenges within Raleigh-Durham’s commercial real estate space?
Repurposing retail spaces that are either dark or gray at this point is going to be critical. So many things have transitioned to online during COVID, that these service experience locations and entertainment venues are really suffering. We’ve had more retailers go bankrupt in the past year than in 2007-8, which is an astounding statistic. Instead of replacing big box retailers we’re converting those spaces into concepts such as walk-in clinics. COVID is changing the face of retail. We are activating dark spaces by creating pop up concepts, in order to continue to bring life and activity to retail spaces. A new use for second generation restaurant spaces is a ghost kitchen. If you think about all of the local delivery services, the way for a lot of restaurants and caterers to survive is to have access to a ghost kitchen in a different city allowing them to prep and deliver from there, rather than delivering from their restaurant that is 30 to 40 minutes away. The entrepreneurs doing master leases on ghost kitchens are geniuses. The silver lining of COVID is that it has pushed everyone to embrace technology that maybe they may have been reluctant to utilize before.
What is your outlook for Raleigh-Durham’s commercial real estate sector?
As a company, we project that this will be our best year since at least 2017. The legwork that we did during COVID in 2020 has really set the tone for 2021. Coming into the year with a strong pipeline was important and will really dictate how the rest of the year looks. As for the local real estate market, consumer confidence continues to grow as the vaccines are disseminated. The draw to our market is stronger than ever and we continue to add over 60 people per day. Investors continue to show confidence in our area and competition remains high for commercial investment opportunities.
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