Southern Nevada’s Post-Lockdown Expansion Kicked into High Gear in Q1
Las Vegas, NV – April 27, 2022 – Commercial real estate in Southern Nevada has made a significant recovery in Q1, dramatically improving from 2020’s lockdown-induced recession. In addition, all commercial real estate sectors have either recovered from 2020 or are in expansion mode.
Although Southern Nevada’s economy has largely recovered, several global and national factors could reduce the economic expansion or reverse the growth. Local businesses and governments must adapt if international and national economic forces begin to interfere with the Southern Nevada economy. However, Southern Nevada is pacing upward for prosperity.
Southern Nevada’s industrial market is on track to beat 2021’s record demand. The warehouse and distribution market are soaring due to the e-commerce industry’s rapid growth during record spending of COVID-19 lockdowns. Additionally, light distribution, light industrial, and incubator have record low vacancy rates Q1.
Land development continues to increase as demand grows in Q1. Industrial and residential development continues to soar in Southern Nevada, causing vacant land to be depilated. There is an opportunity for redeveloping under-occupied buildings and developments for residential use; however, these redevelopments are costly and rare. As vacant land continues to be scarce, investors and developers will need to source land.
Southern Nevada’s retail market is on track for a promising 2022. Net absorption is high, and vacancy is the lowest in nearly two decades. In Q1, investment sales soared in terms of the quantity of square footage sold, congruent with record-breaking prices retail centers are demanding. However, while the retail market looks promising in 2022, the ongoing national and global economic logistical issues could cause a decline.
Southern Nevada’s medical office market is effectively recovering to pre-pandemic rates. Assuming the national and global economies remain on an upbeat track, the medical market office is projected to be prosperous in 2022. While demand for medical office space decreased in Q1, it remained positive for the fifth quarter.
Southern Nevada’s office market is returning to pre-pandemic rates. Net absorption rates have remained around 300,000 square feet consistently the past four quarters, hitting record-high numbers of expansion for office space since 2017-2018. Southern Nevada’s office market will continue recovering and expanding as long as national and international economies continue to thrive.
Aside from the unfinalized sale of the Cosmopolitan of Las Vegas and The Mirage Hotel & Casino, Southern Nevada has experienced no notable hospitality sales in the previous two quarters, a trend we continued to see in Q1. Although hospitality sales are taking a backseat compared to industrial and multifamily markets, investment should increase in 2022 as the hospitality industry continues to recover and expand.
Full report available for download here: https://www.colliers.com/en/research/las-vegas/2022-q1-las-vegas-lvqr-market-research-report