Montana MarketWatch Events
Get an edge on Montana commercial real estate at MarketWatch.
Each year in Missoula and Bozeman, SterlingCRE delivers fresh commercial real estate data and looks ahead to opportunities around the state.
Missoula MarketWatch is on Wednesday March 6th, 2024 from 2pm to 4pm | Reception to follow from 4pm to 5pm.
Click the button below to sign up to attend.
Hosted by Sterling Commercial Real Estate Advisors
Bozeman MarketWatch 2023 Wrap Up
In 2023, Commercial Real Estate performance was a mixed bag across Bozeman. For tenants and buyers looking for retail and industrial, options remain woefully limited, with few options coming to market.
Multifamily owners and developers saw vacancy rates surge from under 1% to over 7% in a year. The packed development pipeline is delivering more apartments than the market needs. However, a growing economy should drive demand and fill new apartments over time.
The office market has proven resiliant in Bozeman, however the delivery of a significant amount of spec space could push up the vacancy rate in 2024.
Despite robust demand from commercial real estate users, investors have largely been on the sidelines, as rising cap rates and costs of capital have impacted what they can spend on properties. At the same time, property owners are pleased with performance or perhaps overpaid and are unwilling to drop their prices. This has led to a considerable drop in transactions across Bozeman.
To watch the event, the videos are provided to the right.
A Look Back at Missoula
Missoula’s commercial real estate market continues to face low vacancy rates, with a limited supply of office and retail spaces to meet growing demand. Elevated building and development costs and restricted commercial lending have led to a contraction in the pipeline of new projects.
Overall, these are the most limited pipelines ever noted in SterlingCRE research. As a result, the market remains constrained, perpetuating the cycle of low vacancy and limited commercial space. The one exception is the multifamily housing sector, which is starting to approach equilibrium as vacancy rates have been increasing over recent quarters.
In 2023, market forces are expected to continue driving demand, incentivizing new construction and balancing supply across asset classes.
A Look Back at Missoula
Economic growth and evolving local industries drive Missoula’s commercial real estate market. It’s a trend that will continue in the coming year. The key to successful investing lies in understanding economic growth and the changing business landscape.
In 2021, experts predict economic recovery in Missoula. The city enjoyed steady employment and economic growth for the past decade. That is until the unexpected events of 2020 stymied that prosperity.
Yet, Missoula suffered less drastic employment drops than most cities across the nation. A diverse economic base and ongoing population growth buffered local losses.
A Look Back at Bozeman
At Bozeman MarketWatch, Ryan Springer, CCIM/lead broker in SterlingCRE’s Bozeman office reviewed the state of the Gallatin County CRE markets. Springer noted that the dominant theme across Bozeman is low vacancy in every asset class. As a result, sale and lease prices are up. Late 2021 and early 2022 were boom months when it came to the prices owners could get for their assets.
What may be balancing low vacancy in the coming 12 – 24 months are many large commercial projects coming to the market. But, as we saw throughout the last 12 months, new builds can be a gamble because of spiking construction costs.
It’s important to put Bozeman vacancy in perspective, says Springer.
Nationwide, retail vacancy is 10.3%, which is triple the local retail vacancy of just under 2.6%.
Industrial assets are tough to find both in Montana and nationwide, with our local vacancy of 0.40% even lower than the national vacancy of around 4%.
Bozeman’s office vacancy rate is 3.01% percent, versus a national vacancy rate of nearly 20% as per JLL.
And while interest rates put the brakes on for some buyers, SterlingCRE is still seeing plenty of capital in the market (including lots of 1031 exchanges). Overall, commercial inventory is light across the board with high demand, limited land supply, and fear of construction costs.
Watch this space for future Bozeman MarketWatch insights.
Contact Ryan Springer, CCIM, here.
A Look Back at Missoula MarketWatch 2020
On March 11, 2020, Sterling CRE Advisors hosted Missoula Market Watch, an evening full of insights on commercial real estate in Missoula. A lot has changed in the market since that evening due to the COVID-19 pandemic and resultant near economic shutdown. The full impact of the virus on commercial real estate values, vacancies, and rents remains to be seen.
Sterling CRE Advisors is hopeful that Missoula’s healthy economy and real estate market will help our community weather the storm and recover quickly. While conditions have changed dramatically, much of the content from the evening is still relevant today.
For those of you looking for something educational to binge-watch, the full Missoula Market Watch video can be found on our YouTube channel.
Using Asset Management to Increase Property Value
Jessica Morina, an experienced asset manager walks us through a case study of how she approaches management changes to maximize a property’s value. By taking steps including enforcing lease terms and renegotiating property service expenses, her approach quickly adds value. Jessica manages commercial properties throughout the state of Montana, with properties in Missoula, Bozeman, Kalispell, and other cities.
Matt Mellott, CCIM
How Not To Overpay For A Deal
Matt Mellott, CCIM walks us through how he evaluates a multifamily deal before investing. He takes us through the process of evaluating the deal and pro-forma objectively, creating a financing plan and calculates a counter offer. Matt specializes in finding and analyzing apartment deals in Missoula, Kalispell and Bozeman, but his process works in any market.
Claire Matten, CCIM Why Investors Love Industrial & Warehouse, Even in a Down Economy
In this segment, Claire Matten, CCIM talks about Industrial and Warehouse, and why it is an asset that is always in demand. In this segment, she discusses the growth of E-Commerce, changes in distribution systems, and key user groups for Industrial space in the future.