Economic and Demographic Update

Population: The population in Columbus in the 4Q of 2020 was 2,146,327. This represents an increase in total population of 18,343 over the course of the last year. During 2019 Q4, the Columbus population stood at 2,127,984. The number of people employed rose to 1,043,690 in 2020 Q4 from 1,027,823 over the last quarter, an increase of 15,867 or 1.54% for the period.

Median Income: The median household income for Columbus in the 4Q of 2020 was $70,070. At this time last year, the median household income was $69,525. 2020 Q4 median income represents a quarter-over-quarter increase of 0.78%. Columbus has a median household income greater than the U.S. average, which is $69,270.

Current and Historical Data Review (Rates PSF, Vacancy)

Office leasing: Overall office base rent rates have increased by $0.27/SF. Rates grew from $14.56/SF in 2020 Q3 to $14.83/SF in this most recent quarter. Office rates grew in 2020 Q4 when compared to last year’s quarter, when office base rent was $14.35/SF.

In 2020 Q4, overall market rents decreased in Columbus by 0.30% since 2020 Q3, bringing market rent per square foot to $21.17.  

Vacancy rates also went from 7.73% to 8.28% quarter over quarter. They stood at 7.07% this time last year. During that same period, the vacancy rate is expected to change from 8.28% to 8.83% next quarter.

In the Columbus market’s central business district (CBD) specifically, 2020 Q4 base rents stood at $21.11/SF, a decrease from $21.19/SF in 2020 Q3. When compared to last year’s quarter, CBD office rates decreased from $21.62. 

CBD vacancy rates went from 7.47% to 7.85%. They stood at 6.78% in 2019 Q3. Throughout 2021 Q1, the CBD vacancy rate is expected to increase to 8.15%. 

Office Sales Metrics (Cap Rates, Volume, Average Price PSF)

For investors, the average cap rate during 2020 Q4 was 7.85%, compared to the previous quarter’s cap rate of 7.93%. The cap rate was 8.38% this quarter last year.

In terms of transaction volume, there were 62 sales transactions during the quarter. That’s a decrease compared to the 80 transactions in the previous quarter. Last year at this time, there were 95 transactions. In terms of transaction amounts, office transactions were valued at $103,122,240 in 2020 Q4. That’s an increase compared to $73,853,520 of transaction value in the previous period. Last year at this time, total office transactions were valued at $292,813,568.

Industrial Leasing Metrics (Rates PSF, Vacancy)

Industrial leasing: For the Columbus, OH industrial sector, we look at warehouse and distribution spaces specifically. Warehouse and distribution base rent rates have increased by $0.04/SF. Rates grew from $5.00 in 2020 Q3 to $5.04/SF in this most recent quarter. Warehouse and distribution rates grew in 2020 Q4 when compared to last year’s quarter, when industrial base rent was $4.95/SF.

Warehouse and distribution vacancy rates decreased from 6.81% to 6.77%. Next quarter, the vacancy rate is expected to drop to 5.75%.

Industrial Sales Metrics (Cap Rates, Volume)

For investors, the average industrial cap rate during 2020 Q4 was 7.12%, compared to the previous quarter’s cap rate of 7.10%. The cap rate was 7.03% this quarter last year.

In terms of sales volume, industrial transactions were valued at $328,716,874 during the quarter. That’s an increase compared to the $226,446,319 of transaction value in the previous quarter. Last year at this time, industrial sales transactions totaled $313,937,815.