Market Drivers

One of the hardest things to really get comfortable with as a commercial real estate (CRE) investor are the drivers of the particular market you are in. What I mean by drivers are the things that directly affect the particular genre of CRE you either own or are interested in.

For instance if you own a 20,000sf warehouse the Market Drivers you are looking to understand are those things that will impact your ability to lease your space for the highest possible price. Including: whether the city you’re in is attracting and growing businesses that need warehouse space; whether others are building additional properties on speculation and thus affecting the supply of similar spaces; whether there has been a legislative change that will somehow constrain or limit potential users of your building. These are your Market Drivers.

Market Drivers are what should keep you reading the news everyday and doing your best to keep up with the shifting of the local business climate.

Chattanooga has been a transit hub for a long time. It’s well positioned roughly a two hour drive from so many population centers it has a distinct geographical advantage. This was not lost on people in the business of transportation and there have been many companies founded and moved here for exactly that reason.

The news today that Arrive Logistics has raised another $25m for future expansion is a prime example of local Market Driver. Their expansion will naturally require an expanded footprint in proximity to their existing headquarters.

With the volume of office space available in downtown and the growth of downtown residential this is a very important step in filling out the core of Chattanooga and making it a 24hr city.

Congratulations to Arrive Logistics and especially to downtown Chattanooga this is a great step in the right direction.