Commercial Real Estate Insights
As we predicted, 2024 was certainly a year of change and growth across Asheville MSA’s commercial real estate market. The first quarter saw the opening of several boutique hotels in historic buildings, as well as strides toward additional affordable development. By the middle of the year, our local multi-family sector was soaring. The retail market emerged as the top-performing asset class in the country, a trend reflected in a number of new Asheville restaurants slated to open in the fall.
However, this time last year, it was impossible to predict the degree of changes brought about by Hurricane Helene in late September. Tourism was a $3 billion industry in Buncombe County, amounting to 20% of the county’s GDP. In fact, visitors supported $1 billion in local wages in 2023. During the last quarter of 2024, a significant portion of that revenue dried up.
According to state officials, the storm damaged more than 73,000 homes and caused nearly $2.4 billion in damage to commercial and nonprofit buildings—not to mention damage to infrastructure and farm land. Up to 80% of the buildings in Asheville’s bustling River Arts District were damaged. This caused immediate catastrophic effects to the local economy. Even though many neighborhoods have been bouncing back in recent weeks, those effects are far from resolved. Local businesses are projected to lose $585 million in visitor spending alone during the first quarter of 2025.
In more inspiring news, the storm encouraged locals across WNC to reinvest in community and infrastructure. In Asheville, voters approved $80 million in General Obligation Bond Referendums for various improvements, including $20 million for affordable housing. The funds will be prioritized to make investments in affordable homes, support homeownership through home repair grants and/or downpayment assistance, and purchase land and existing homes for future affordable housing.
Prior to the storm, demand for commercial real estate remained high across all space types, indicating a strong business community and continued growth. We expect these trends to continue, albeit with a few stops and spurts. 2025 will certainly be a challenging year for many small businesses, particularly those who rely on tourism income.
With the effects of the storm still fresh in many minds, it remains to be seen how long it will take our economy to recover to pre-storm vitality. Expect to continue hearing the name “Helene” often throughout the coming months.
Year-End 2024 Commercial Sales Activity Review:
- 11 Industrial Transactions for $28.3 million
- 9 Office Transactions for $15 million
- 28 Retail Transactions for $41.8 million
- 10 Multi-family Transactions for $41.9 million
- 9 Land Transactions for $23.2 million
Year-End 2024 Commercial Lease Activity Review:
- 23 Industrial Lease Transactions, Vacancy Rate of 3.2%
- 35 Office Lease Transactions, Vacancy Rate of 2.5%
- 33 Retail Lease Transactions, Vacancy Rate of 1.5%
All information represents 2024 data as provided by CoStar for the region.
About the Featured Listing
3100 NC Highway 226 Highway S in Marion
MLS#: 4202356 | 24,800 SF | $1,950,000
Listed by: Mark Morris, CCIM and Karl Nelson, CCIM
Discover an exceptional property for investors looking for stable passive income!
Take advantage of a prime investment opportunity in this strategically located industrial property with two tenants, anchored by a credit tenant, offering reliable cash flow. Situated at Exit 86 on I-40, this 24,800-square-foot flex space sits on 2.94 acres with 710 feet of road frontage along Highway 226.
The property features 2,000 square feet of office space, dock and drive-in access, six roll-up doors, and 16-foot ceilings. A new TPO roof and modern electrical service complement its infrastructure. Located in a high-traffic area with 32,000 daily vehicles, the property is surrounded by national credit tenants, McDowell Tech, and major employers like Baxter and Smurfit Westrock.
All real estate is local. In order to make confident real estate decisions, it is important for you to have timely and neighborhood-specific information. For more information about our commercial real estate market, ask your NAI Beverly-Hanks agent or click here.