Q4 2023 CITY OF MANASSAS MARKET REPORT
Commercial and industrial vacancy rates remain historically low at 2% Citywide. This far outperforms the regional average and demand from businesses for new or larger spaces is hard to fill. This continues to drive increased rents and building values. Average commercial rents reached an all-time high of $21.22 per square foot while the average sales price settled slightly down at $217/sf. Despite whatever headwinds other markets may experience from interest rates and remote work, the City of Manassas continues to see strength across all property types. As we’ve said in the past, low supply and high demand should present opportunity for new and redevelopment – we are ready to assist developers who wish to build or expand in Manassas.
The “new normal” is that industrial and flex space is almost impossible to find in Manassas. Vacancy rates for traditional manufacturing space did rise slightly this past quarter from .5% to 1.1% while flex space vacancy dropped slightly from .8% to an almost nonexistent .7%.
Rents hit an all-time high of $15.88/sf for industrial and $16.10/sf for flex space and to further demonstrate how tight things are – the time on market for space is a staggeringly low 1.1 months. It’s literally a first-come, first-served market when a space opens up.
RETAIL MARKET
The City’s ongoing efforts to improve its commercial corridors is evidenced by continued investment and revitalization resulting in a 2.8% vacancy rate that is well below the regional average of 4.35%.
Market rents declined and the current average is $26.87/sf but that is still well above historical averages. This data indicates that retail continues to be a highly active sector in Manassas thanks to the City’s rising incomes and increasing residential density within and around the City limits.
Vacancy for office space also continues to outperform the region with an almost historically low rate of 3.2%, down from last quarter’s 4.1%. This compares to a 16.4% office vacancy rate in the Washington DC metro area.
Real estate experts have predicted an increase in office vacancy heading into 2024, but Manassas has historically shown resiliency despite broader market trends. Rents rose slightly to $25.54/sf but are significantly higher than in the past several years.
