It’s no secret that Bozeman is changing fast: for retail operations, the question might be to buy or to lease? Sterling CRE research director, Sara Townsley, has been keeping track of those shifting dynamics. So what do these changes mean for Bozeman area business?
Many clients looking to expand their office, retail, or warehouse space are confronting significant barriers requiring deliberative and thoughtful consideration to overcome them. The price of materials, a limited labor pool combined with significant regulatory hurdles have pushed owners into considering buying into known variables of an existing building in an effort to minimize and/or bypass these hurdles of new construction.
Some potential buyers intending to occupy are looking for multi-tenanted properties to offset some operating costs through the additional rental income. As Bozeman continues to attract new businesses to support its population growth, finding a space with leasable square footage can help defray the expense of owning your building as well as providing a conduit for the owner’s future business expansion needs.
If you do decide to buy a building with additional space, keep local lease rates in mind. For Bozeman retail, lease rates came in at just over eighteen dollars per square foot this year, triple net – but, location can play a big role in setting rates and we expect rates to continue to escalate.
For more commercial real estate data from across Bozeman and throughout Montana, contact Ryan Springer.