Study finds Jackson has lowest commercial real estate cost
by MBJ Staff
Published: August 30,2012
JACKSON — The Building Owners and Managers Association (BOMA) International, using the results from the 2012 Experience Exchange Report (EER), has compiled a list of the most and least expensive commercial real estate city-markets in the United States.
The annual report aggregates rental income and operating expense figures from the previous year; in 2011, data was gathered from more than 5,400 buildings across 125 distinct markets.
The five most expensive city-markets (total operating expenses) are:
1. New York, N.Y.: $12.46 per square foot (psf)
2. San Francisco, Calif.: $10.39 psf
3. Washington, D.C.: $10.18 psf
4. Boston, Mass.: $9.21 psf
5. Los Angeles, Calif.: $8.96 psf
The five least expensive city-markets (total operating expenses) are:
1. Jackson, Miss.: $4.71 per square foot (psf)
2. Fresno, Calif.: $4.78 psf
3. Salt Lake City, Utah: $5.01 psf
4. Virginia Beach, Va.: $5.11 psf
5. Shreveport, La.: $6.17 psf
Total operating expenses incorporate all expenses incurred to operate office buildings, including utilities, repairs and maintenance, roads and grounds, cleaning, administration and security. Fixed expenses include real estate taxes, property taxes and insurance.
In New York City, average total operating plus fixed expenses were $21.46 per square foot (psf), while they averaged just $4.71 psf in Jackson. Operating expenses increased in most markets in the last year, but rent-based income and overall income also saw increases, which helped insulate building owners and managers as their profits continue to gradually return.
The five most expensive city-markets (total rental income) are:
1. New York, N.Y.: $45.15 per square foot (psf)
2. Washington, D.C.: $44.10 psf
3. Boston, Mass.: $35.51 psf
4. San Francisco, Calif.: $34.24 psf
5. San Mateo, Calif.: $33.80 psf
The five least expensive city-markets (total rental income) are:
1. Shreveport, La.: $11.76 per square foot (psf)
2. Dayton, Ohio: $11.79 psf
3. Harrisburg, Penn.: $13.41 psf
4. Saint Louis, Mo.: $15.35 psf
5. Nashville, Tenn.: $15.54 psf
Total rental income includes rental income from office, retail and other space, such as storage areas. As the commercial real estate market continues its recovery, most areas are seeing meaningful increases in rental income, suggesting that tenants may begin to see rental rates increase as building owners become more confident in their earning potential.
To sign up for Mississippi Business Daily Updates, click here.
One Response to “Study finds Jackson has lowest commercial real estate cost”
Top Posts & Pages
- Jail kitchen supervisor pleads guilty to stealing food
- A BIG CHANGE: New mortgage rules seen bringing increase in pricey mobile home loans
- Warden who lives hundreds of miles from jail resigns
- Top 10 finalists chosen for C Spire Conerly Trophy
- Ex-MDEQ leader Fisher joins Butler Snow
- State’s new banking chief Charlotte Corley has deep roots in the business
- DAVID DALLAS: Savor this Thanksgiving and be grateful
- Analyst: KiOR Columbus plant may end up sold as scrap
- (UPDATE) Gov. Bryant: $1.2 billion aluminum plant is a very exciting proposition for the state of Mississippi