Best Cities for Commercial Real Estate in 2023

We're still early in 2023. So if you haven't started on your resolution, how about saving your business millions of dollars in commercial real estate costs?

The way to do this may be taking the opportunity to relocate to a low-cost, low-tax, high- talent area. The Urban Land Institute recently released a study that highlights five of the country's commercial real estate markets in terms of affordability, population growth, features and longevity.

From these findings, it is clear that businesses looking to relocate their commercial properties should consider one of these major cities, as they offer great prospects for success. We'll explore each city in detail and discuss why they are such attractive options for businesses seeking new premises. Because, for businesses looking to maximize their CRE investments, it's essential to know where the best opportunities are located. So, as we start to close on the goodbyes to 2022, let's dive into the cities that have commercial real estate investors and tenants rushing to relocate.

1. Nashville

Nashville has quickly become the strongest city for commercial real estate investments. With its vibrant music scene, booming economy, and low cost of living, it has become a popular pick for those looking for an optimal location for their business.

Last year, Forbes magazine named Nashville as the city with the greatest financial growth among the nation's largest metro areas. It also is the first city since San Francisco (in 2014) to repeat the top ranking in the annual “Emerging Trends in Real Estate."

The commercial real estate market in Nashville is also full of opportunity.  No personal income taxes, and a business-friendly environment make it affordable. Additionally, the city of Nashville has implemented a number of incentives to encourage businesses to invest in commercial real estate.

Nashville is also known for its quality of life, as well as its temperate climate. The value of the dollar goes further so you get more bang for your buck. 

As a result, there has been a strong demand for all commercial real estate properties, from office buildings to industrial real estate. In fact, Tennessee is particularly attractive to businesses looking for industrial spaces because its central location make shipping and logistics more efficient. Even more so, the state's cost of living remains low throughout. 

Overall, Nashville offers many advantages for those looking to invest in CRE. It is an attractive choice for investors and businesses alike.

2. Dallas-Fort Worth

Dallas has earned the second spot for the best commercial real estate markets. This city is thriving in terms of CRE opportunities, due to its strong economy, abundance of office- jobs, and advancements in tech and biotech innovation.

The Dallas-Fort Worth Metroplex is home to over two dozen Fortune 500 companies, accounting for one-third of Texas’s $1.8 trillion economy. According to the Urban Land Institute, Dallas jumped five spots from 2021 and is now the second best city in terms of commercial real estate market. This has been attributed, in part, to the influx of new businesses looking for space in this thriving metropolis.

Texas has, perhaps, the strongest business friendly environment in the country. Dallas is then its brightest star. Learn the other top cities for your commercial real estate in the lone star state.

3. Atlanta

Atlanta has slowly and surely become one of the most attractive CRE prospects in the country. Its skyrocketing financial sphere, job growth, and strategic location land it at the apex of opportunities for the commercial real estate industry.

Moreover, Atlanta has lured top companies from all over the world. A total of 29 Fortune 500 companies and 203 of country's quickest growing private companies have found roots in Atlanta in recent years.

The city's business climate has been bolstered by its low taxes, attractive features and infrastructure, and pro-growth policies which, in turn, create more opportunities. And it is set to get even stronger as we enter 2023.

In preparation for the next World Cup, the city broke ground on a $5 billion development project. The new construction is set to take this Georgian city from a rising star to a supernova, as 50 acres and 8 million square feet of mixed-use land in the CBD will be completed by 2026.

The city is also known for its vibrant job market with abundant opportunities for tech and IT professionals as well as business students. Furthermore, Atlanta is home to the world's busiest airport, further making it a top destination for commercial success. However, depending on where you're looking, be aware that Atlanta is notorious for its traffic. 

Learn more about Why Atlanta is a Top City for Commercial Real Estate.

4. Tampa

Tampa is the fourth best city for commercial real estate in 2023. It has a strong, growing local economy, attractive features, and low cost of living.

While this may not seem like much of an improvement, compare it to other top markets like NYC where the cost of living is 146% above the national average, according to Payscale.

The affordability is a partial driving factor behind the loyal, 3-million strong Tampa Bay population. There is also a robust job market with unemployment rates far below the national average. It also boasts a low corporate tax rate, and no personal income tax rate making it an attractive option for businesses looking to relocate or expand their operations. States including Florida, Texas, and Tennessee (among others) do not have personal income taxes. That is a huge driving force for many Americans. 

So, in terms of commercial markets, Tampa is very favorable. Office space availability, rent prices, and corporate taxes all contributing to its attractiveness. It also benefits from its geographic area on the Gulf Coast as the nearby beaches offer plenty of leisure activities for employees and potential customers alike.

Not so bad for a view from your office. Eh? 

If you're looking for commercial real estate in Tampa, or any of the other top cities on this list for that matter, there's things you can't afford to get wrong. Competition is stiff so don't risk going in unprepared. Learn the key factors corporate tenants need to know when looking for office space in the free course below. 

5. Austin

Austin is one of the best commercial real estate markets in 2023 thanks to its flourishing economy, low cost of living, and plentiful opportunities.

The city is well known for its technology sector, as it has become a hub for innovative startups and tech companies. This has resulted in an influx of new businesses looking for space to set up operations, and take a piece of this cutting edge environment. Accordingly there has been sustained demand in the commercial real estate market with large tech companies, like Apple, Samsung, and Tesla choosing to either fully relocate or set up large offices in Austin.

Austin also currently boasts a 2.6% unemployment rate, much lower than the long term average of 4.3%. This, along with low inventory, high rental demand, and gradually rising prices has caused Austin's market to boom. It also funnels its state capital back into its industries to further encourage growth. In 2019 alone, it, invested 1.9 billion in tech companies and startups. This kind of investment demonstrates the city's commitment to economic growth and stability, which makes Austin an attractive option for a commercial real estate property investment.

Relocate to the Best Cities with a Tenant Rep

Commercial real estate is a non-homogeneous product. So, depending on your organization's needs for a commercial property, your optimal city would differ. However, these cities each provide the optimal conditions for new tenants looking to lease space. From impressive population growth rates to high demand for commercial investments, these 5 cities are expected to sustain the most economic growth going into the new year.

If you're looking for commercial space, consider relocating to one of these booming markets. But, don't risk getting it wrong. There are a lot of other factors to consider when looking for properties. Doing it alone or without a True Tenant Rep™ may lose your your opportunity for the best space for the best price possible. The due diligence that True Tenant Reps™ at iOptimize Realty® provide is unmatched. With 30+ years of market intelligence, we have mastered the process of CRE portfolio optimization by using the Three R's: Right-sizing, Relocating, and Renegotiating. 

Hear how the Three R's can save your company millions and talk to a True Tenant Rep™ at iOptimize Realty® today.