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JUNE/JULY 2024 VOLUME36 ISSUE4 CRE MARKETPLACE PAGE 38:
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Still resilient: Higher interest rates, a labor shortage and soaring construction costs can’t break Omaha’s CRE momentum By Dan Rafter, Editor
The new Mutual of Omaha office tower will provide another boost to downtown Omaha. (Photo courtesy of Mutual of Omaha.)
T
he same word comes up when developers, brokers and other professionals speak about the Omaha commercial real estate market: resilient.
the government and private sector, the continued investment in downtown Omaha and the lower cost of living and strong amenities that make Omaha such an appealing place to call home.
Yes, the Omaha commercial real estate market isn’t immune to the challenges of higher interest rates, increasing construction costs, stubborn inflation and a shortage of skilled labor. It’s why Omaha is seeing fewer investment sales of commercial real estate assets, and why vacancy rates are up in certain sectors.
It all combines to make Omaha one of the most resilient of Midwest markets, even when the national economy continues to throw challenges at the brokers and developers working here.
But even with a slight slowdown in leasing and sales activity, the Omaha commercial real estate market remains one of the steadiest in the Midwest. Developers are still planning new industrial facilities and office buildings. New-to-market retailers continue to target Omaha. And the market’s multifamily properties continue to fill up with renters eager to live in both downtown Omaha and its suburban communities.
Mike Homa, president of the Nebraska Division for R&R Realty Group, points to the Omaha-area office market as evidence of this region’s resiliency. While the office sector here has faced challenges resulting from the work-from-home movement, it’s fared far better than this sector has performed in other U.S. cities.
What is Omaha’s secret? It’s nothing revolutionary. Developers and brokers point to the experienced development community here, the strong partnership between
Outperforming the rest of the country
Homa said that the overall office vacancy rate in the Omaha market stands at a low 9%, below even pre-pandemic levels. That vacancy rate is even lower for the OMAHA (continued on page 18)
MILWAUKEE
A thriving downtown. A pro-business environment. And plenty of optimism: That’s what brokers and developers working here say sets Milwaukee’s CRE market apart By Dan Rafter, Editor An adjustment period. That’s what the Milwaukee commercial real estate market is going through today. But fortunately for the developers and brokers who work in this market, Milwaukee remains a favored destination for companies seeking headquarters and regional offices in the Midwest. The region remains popular, too, with residents, who seek out the area’s low cost MILWAUKEE (continued on page 22)