Buyers Outweigh Listings in the Boise Investment Market

Submitted by Anonymous (not verified) on Mon, 03/15/2021 - 10:03
TOK Commercial's Investment Report for Q1 2021 in the Boise MSA

Despite the economic conditions the pandemic created both locally and nationally, Boise’s Investment market ended 2020 with the third strongest transaction volume on record. In addition, the number of off-market deals continues to increase, highlighting that the true value is undoubtedly higher than the year-end investment transaction total of $574 million. Many offerings do not make it to market in this environment where the number of buyers far outweighs the number of listings available.

With interest rates remaining near record lows, and unlikely to rise in the short term, investors will continue to buy commercial properties in order to improve returns on their money. Well-priced investments will receive strong interest from buyers, with the likelihood of multiple bids, sometimes pushing above the asking rate.

Increased demand from out-of-state buyers also continues to increase sale prices and suppress cap rates in the market. With Boise’s strong in-migration, this is not likely to abate any time soon. Boise is ranked third in the nation for economic growth outlook (State Economic Competitive Index), making business moves to the area a more common occurrence each day.

Industrial product, with vacancy currently in the low-3 percent range, will be highly sought after in the coming year. Apartments that are breaking ground (or close to) and on the market, will continue to trade hands before construction is even complete. Office and retail product (42 percent and 21 percent of sales, respectively) will see continued strong interest, especially as people return to the office, to shopping, and to restaurants.

For more information on the investment market, you can read our current Quarterly Investment Market Report or subscribe to receive monthly updates

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