2018 Greater New Orleans Annual Office Market Report

2018 Greater New Orleans

Annual Office Market Report

201 St. Charles Avenue, Suite 4411 New Orleans, LA 70170 (504) 581-5005 corp-

2018 Office market overview

Corporate Realty, Inc. is proud to present our seventh annual Greater New Orleans

Office Market Report.

We publish this report to give the reader a broad understanding of the Greater New Orleans office market as well as specific information about occupancy and rental rates of each office building that contains at least 20,000 rentable square feet (rsf). With data from 2012 - 2018, this report offers a snapshot of the current market and analyzes market trends. Most graphs in this report feature data from 2013, 2017 and 2018 to illustrate both immediate and long-term change.

In addition to this annual report, Corporate Realty publishes quarterly reports of the office market compiled by Bruce Sossaman. These reports can be found alongside previous annual reports at corp-.

Corporate Realty agents are consistently involved in the largest, most complex and most demanding real estate transactions and management assignments in this region, and we pride ourselves on having the top real estate professionals in the market.

To find out more about us and our services, visit us at corp-.

table of contents

greater new orleans

market overview

1

central business district 4

orleans parish, non-cbd 8

east metairie

10

west metairie/kenner 14

elmwood

15

north shore

16

west bank

18

st. charles parish 19

corporate realty's office specialists 20

MIKE SIEGEL, PRESIDENT CORPORATE REALTY, INC.

51

greater new orleans market overview The largest submarket in the Greater

Metairie market is approximately 89% leased

New Orleans market remains the Central

and these ve buildings are 88% leased.

Business District (CBD) with approximately Rental rates in these Class A buildings are

11.25 million square feet (sf) in a total of 27 in the $22.00 - $25.00 psf (gross) range. e

buildings. Within the CBD, approximately

non-Class A buildings are in the $18.50 -

80% of the total CBD square footage

$20.00 psf gross rate range.

is located in 15 Class A buildings. e

balance of approximately 2.2 million sf

is in small, generally non-competitive or

single tenant non-Class A buildings. e

CBD o ce market has "shrunk" from a

high of approximately 16.5 million sf in

1990 to its present level. is is a result of

rmeloarteiviemlyCploOorwVtaIdnNetlmGy,TasnOigdNnfiorcaontcdeesmpaancedafnodr ,

new apartments, condos, and hotels. Most

of the o ce product that has been taken

o the market has been converted to these

alternaMtiAveNuDsEesV. IALsLkEing rates in the 15

Class A o the $17.00

ce buildings in the per rentable square

CfoBo1D2t (aprresfin) -

$21.00 prsf (gross rent) range. Occupancy

iwtnhietthhPneaoOnCmN-lCauTsclCsLahsAHAsloKAAmwERaebTrrukRoielcAdtciIiunsNpgasapnpincryothxpieemrCcaBetenDlty.ag8e8%in

Over the past several years, the New Orleans o ce market has shown a great deal of stability but very little growth. e Greater New Orleans o ce market continues to be the bene ciary of a steady stream of entrepreneurial start-ups and small companies' expansions along with a handful of new "major" tenants moving into New Orleans ? most notably GE in 2013 and DXC Technology in 2017. Technology, medical and small entrepreneurial companies are gradually replacing the historic oil and

gas based o 5ce9sector. On the other hand,

New Orleans remains a small tertiary o ce market that tends to be adversely impacted by corporate mergers and acquisitions. For

tmhSaerLlkaIesDtt EhseaLvsLetraakleyneaornse, 1tsh0teepNfeowrwOarrldeaannsdoonece

step back, resulting in the aforementioned

e other substantial submarket is the

stability, but also not allowing for any

Metairie market, which is separated in this

meaningfu10l increase in rental rates or

report as East Metairie, West Metairie/

occupancy. e key to real improvement

Kenner and Elmwood. e Metairie

in the overall New Orleans o ce market

submarket contains approximately 5.2

will be in the region's ability to attract more

million sf in 46 o ce buildings. ere are

companies to move to, or open o ces, in

only ve true Class A o ce buildings in this New Orleans with the desired result being

submarket yet they contain 2,040,000 rsf

the growth of white collar jobs, o ce

(39% of total Metairie market). e entire

demand, and rental rates.

GREATER NEW ORLEANS REGIONAL MAP

LAKE PONTCHARTRAIN

WEST METAIRIE/

10

10

KENNER

310

EAST METAIRIE

610

greater new orleans regional Map

ST. CHARLES

ELMWOOD

lake pontchartrain

baton rouge 10

west metairie/ kenner

10

CENTRAL BUSINESS DISTRICT

90

orleans parish, non-cbd

310 airport st. charles

90

east metairie

elmwood

610 WEST BANK

10

central

business district

90

10

slidell/ mississippi

51

noNrOtRhTHshSoHrOReE

cCoOvViInNgGtToOnN

mMAaNnDdeEvViIlLlLeE

12

pPoOnNtTcClLhaHAakKArEeRtTrRaAiInN

5599

SsLlIiDdEeLlLl

1100

110

90

west bank

LAKE PONTCHARTRAIN

WEST METAIRIE/

10

10

KENNER

310

EAST METAIRIE

610

ELMWOOD

10 CENTRAL

greater new orleans office market trends

totaavlearvaegreargeenrtaelnrtaatlersates

$22

$20.57

$20

$18

$17.74 $16.97

$16

total class a non-class a

$14 2012

$19.83 $18.73 $17.14

2013

$19.76 $18.77 $17.51

2014

$19.19 $19.15 $17.71

2015

$20.06 $18.96 $17.78

2016

$20.14 $19.35 $18.07

2017

$20.57 $19.57 $18.00

2018

totaalvearvaegreagoeccoucpcaunpcaynrcaytersates

100%

90%

88.01%

80%

85.64% 79.88%

70%

total

class a

non-class a

60% 2012

90.45% 85.54% 78.91%

2013

91.09% 88.51% 84.53%

2014

90.72% 87.93% 83.61%

2015

Note: The data was first collected for all submarkets in 2013.

89.90% 86.79% 81.96%

2016

88.53% 84.90% 79.82%

2017

87.65% 83.19% 76.80%

2018

2 2018 Corporate Realty Office Market Report

2018 total inventory/total leased

2018 total inventory/Total Leased

Total Inventory: 19,907,560 Square Feet (sf)

Available: 3,347,437 sf

Leased: 16,560,123 sf

(83.14%)

Available: 1,448,023 sf

Leased: 10,273,203 sf

(87.65%)

Available: 1,899,414 sf

Leased: 6,286,920 sf

(76.80%)

2018 total average rental rates

2018 Average Rental Rates

$22

$18.73 $19.35

$20 $19.57

$18

$19.83 $20.14

$20.57 $18.00

$16

$17.14 $18.07

2013 2017 2018

2013 2017 2018

2013 2017 2018

total average

Class A

Non-Class A

$14 total average

Class A

Non-Class A

201280a1v8earvaegraegreernetnatlalrraatteessfor ssuubbmmaarkrektests (cl(aCslsasas&a n&onno-nc-cllaassssAa ccoommbbinineedd) )

$24

$20.10 $21.99

$20.86 $21.55

$21.87

$22.53

$20

$18.88

$18.30

$16

$18.21

$18.25

$17.10

$17.65

$16.20 $17.62

$18.09 $18.54

$17.12 $16.72

$17.33 $18.38

$18.29 $18.70

$18.17 $18.61

$12

2013 2017 2018

2013 2017 2018

2013 2017 2018

2013 2017 2018

2013 2017 2018

2013 2017 2018

2013 2017 2018

2013 2017 2018

$8

CBD

Orleans Parish, East Metairie Non-CBD

West Metairie/ Kenner

Elmwood

North Shore

West Bank

St. Charles Parish

2018 2t0o1t8aTloctoalmCboimnebdineodcOccucpuapnacnycyrRaatteess forrssuubbmmaarkrektests (cla(sCslaass&an&onno-nc-lcalsasssAaccoommbbiinneedd))

100%

80%

81.11%

82.63%

88.45%

83.56%

87.69%

84.89%

87.07%

83.75% 83.16% 84.54%

85.65% 93.68%

89.15% 86.21%

88.36% 71.11%

75.33% 93.45%

87.82% 84.20%

86.71% 81.86% 64.35%

60%

60.55%

40%

2013 2017 2018 2013 2017 2018 2013 2017 2018 2013 2017 2018 2013 2017 2018 2013 2017 2018 2013 2017 2018 2013 2017 2018

20%

CBD

Orleans Parish, East Metairie Non-CBD

West Metairie/ Kenner

Elmwood

North Shore

West Bank

St. Charles Parish

2018 Corporate Realty Office Market Report 3

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