Economic and Demographic Update
Population: The population in Columbus in the 3Q of 2022 was 2,169,281. This represents an increase in total population of 18,097 over the course of the last year. During 2021 Q3, the Columbus population stood at 2,151,184. The number of people employed rose to 1,135,365 in 2022 Q3 from 1,124,165 over the last quarter, an increase of 11,200 or 1.00% for the period.
Median Income: The median household income for Columbus in the 3Q of 2022 was $77,114. At this time last year, the median household income was $71,119. 2022 Q3 median income represents a quarter-over-quarter increase of 1.89% and a year-over-year increase of 8.43%. Columbus has a median household income greater than the U.S. average, which is $74,848.
Current and Historical Data Review (Rates PSF, Vacancy)
Office leasing: Overall office base rent rates have increased by $0.17/SF. They went from $15.53/SF in 2022 Q2 to $15.70/SF in this most recent quarter. Office rates grew in 2022 Q3 when compared to last year's quarter, when office base rent was $14.96/SF.
Vacancy rates went from 9.40% to 9.90% quarter over quarter. They stood at 9.40% this time last year. The vacancy rate is expected to change from 9.90% to 10.00% next quarter.
In the Columbus market’s central business district (CBD) specifically, 2022 Q3 base rents stood at $20.94/SF, an increase from $20.87/SF in 2022 Q2. When compared to last year’s quarter, CBD office rates increased from $20.46.
CBD vacancy rates went from 8.51% to 8.35% quarter over quarter. The CBD vacancy rate is expected to decrease to 8.29% next quarter.
Office Sales Metrics (CAP Rates, Volume, Average Price PSF)
For investors, the cap rate during 2022 Q3 was 8.10%, compared to the previous quarter's cap rate of 7.60%. The cap rate was 8.00% this quarter last year.
In terms of transaction volume, there were 67 sales transactions during the period. That's a decrease compared to the 88 transactions in the previous period. Last year at this time, there were 91 transactions. In terms of transaction amounts, office transactions were valued at $90,324,464 in 2022 Q3. That's a decrease compared to $117,585,880 of transaction value in the previous period. Last year at this time, office transactions were valued at $148,975,824.
Industrial Leasing Metrics (Rates PSF, Vacancy)
Industrial leasing: For the Columbus, OH industrial sector, we look at warehouse and distribution spaces specifically. Overall industrial base rent rates have increased by $0.24/SF. They went from $6.95 in 2022 Q2 to $7.19/SF in this most recent quarter. Warehouse and distribution rates grew in 2022 Q3 when compared to last year's quarter, when industrial base rent was $6.05/SF.
In 2022 Q3, the industrial market rent rates grew in Columbus to 3.50%. Vacancy rates went from 2.90% to 3.50%. Next quarter, the vacancy rate is expected to reach 3.70%.
Industrial Sales Metrics (CAP Rates, Volume)
For investors, the industrial cap rate during 2022 Q3 was 6.40%, the same as the previous quarter's cap rate. The cap rate was 7.00% this quarter last year.
In terms of sales volume, industrial transactions were valued at $331,727,744 during the quarter. That's an increase compared to $268,748,032 of transaction value in the previous quarter. Last year at this time, industrial sales transactions totaled $248,720,144.
