The Charlotte commercial real estate market has experienced robust growth and strong fundamentals across multiple asset classes, driven by the region’s booming economy and population expansion.

Industrial Market

Charlotte’s industrial sector is one of the hottest in the nation, fueled by the city’s strategic distribution location and the growth of e-commerce. The overall industrial vacancy rate in Charlotte was just 2.9% at the end of 2023, with net absorption totaling over 6 million square feet for the year. Rental rates have skyrocketed, with the average triple-net asking rent reaching $8.72 per square foot, up 18.2% year-over-year. Major industrial developments underway include a 1.2 million square foot self storage facility in Concord.

Office Market

The office market in Charlotte has remained tight despite economic headwinds. CBRE data shows the overall vacancy rate was 13.2% at the end of Q4 2023, down from 13.8% a year earlier. Class A asking rents averaged $39.73 per square foot, with the CBD submarket commanding premium rents over $40 per square foot. Major office developments like River District on the Catawba are adding new inventory to meet tenant demand for modern spaces.

Retail Market

Charlotte’s retail sector has rebounded strongly from the pandemic, buoyed by the region’s population growth and rising income levels. The overall retail vacancy rate was 4.1% in Q4 2023, down from 4.9% a year ago. Average asking rents increased to $22.35 per square foot. Grocery-anchored centers remain the top performing retail segment, while mixed-use developments like Waverly are driving leasing activity.

Multifamily Market

Apartment fundamentals in Charlotte are among the strongest in the nation. RealPage data shows the overall occupancy rate was 95.6% in Q4 2023, with annual effective rent growth of 6.3%. Over 13,000 new units were absorbed in 2023 as renters flocked to Charlotte’s urban core and emerging suburban nodes like Ballantyne and Steele Creek.

Hotel & Hospitality Market

Charlotte’s hotel market posted the greatest occupancy gain among major Southeast markets in 2023. As travel habits shifted toward more affordable destinations, Charlotte capitalized on its relatively low average daily rates (ADRs) compared to other metros. The upscale and upper upscale hotel segments led the way with record booking volumes, while economy hotels benefited from housing needs spurring motel conversions. Overall, Charlotte’s ADR is projected to rise over 4% in 2024, one of the fastest paces nationally, aided by robust business travel.

Self-Storage Market The self-storage sector in Charlotte has exhibited very strong fundamentals. According to industry reports, the Charlotte metro had over 10 million square feet of self-storage inventory across 275 facilities as of early 2024. Physical occupancy averaged 93.8%, with rental rates for 10×10 non-climate controlled units around $135 per month. Development activity has been brisk, with over 800,000 square feet of new supply delivered in 2023 alone across 12 newly built facilities. Charlotte’s growing population and business activity are expected to continue fueling healthy self-storage demand.

Why Charlotte, NC for Your Next CRE Move?

SVN Blackstream advisors can help you answer the question. Charlotte’s commercial real estate market offers compelling opportunities across asset types, fueled by robust economic and demographic growth drivers. The city’s business-friendly environment, lower costs compared to gateway markets, and infrastructure investments in areas like the River District are attracting new companies and residents. With forecasted population growth of over 40% by 2040, Charlotte is poised for continued real estate expansion and investment returns.