Real Estate Investing in Charlotte: How Origin Capital Can Help You Invest In The South’s New Hub
Charlotte is home to dynamic growth and is a hub of the new Southern economy. Image from Wikimedia Commons
Real estate investors know that nothing about Charlotte should surprise them anymore, and yet, the Queen City still has a lot of tricks up her sleeve. Barely 40 years ago, Charlotte was a fairly sleepy city of around 200,000, with local industry and agriculture driving most of the economy. Since then, it has exploded to become a major metropolis of over 800,000, with the Charlotte-Concord-Gastonia metro area pushing it to over 2.5 million. It now enjoys a booming downtown, a lively cultural scene, and an influx of young residents.
All of this is due to Charlotte’s expansion as a focus point of national and international business. It boasts a major financial sector and is the second-largest banking sector in the United States. It’s the home of a wide array of Fortune 500 companies and the headquarters to many other regional satellites. Charlotte is the hub of southern transportation and hosts the headquarters of the region’s energy powerhouses (which gave it another nickname: “The New Energy Capital”). In addition, the tech and startup sector in Charlotte is booming, making it one of the fastest-growing in the country. None of this should come as a surprise to investors: Charlotte is a city that never stops moving forward.
Why the Charlotte Real Estate Industry Is Thriving
If you’re looking to invest in Charlotte real estate, there are a few things to keep in mind. At Origin Capital, we look at a city on both a macro and micro level, analyzing broad trends as well as looking at individual neighborhoods and markets on a granular scale. Charlotte provides plenty of opportunity for both. Here are a few factors that demonstrate both the strength and potential of this market:
- Charlotte is poised to be the next big thing in the tech sector: After conquering banking and energy, Charlotte is now looking to become a dominant force in technology. Charlotte is what’s known as a “momentum market.” In terms of size, the tech sector is still outstripped by San Francisco and Seattle, but it’s growing quickly. Charlotte’s tech talent pool grew over 30% in the last five years, surpassing places like Silicon Valley and Austin. Dozens of incubators are currently fueling a growing startup movement.
- Charlotte still has low residential rental prices: As of now, Charlotte apartment rents are nearly 100% below competitor cities like San Francisco. This means that young talent can afford to move here, which will provide more energy for the tech sector, drawing in even more companies. On a relative-basis, apartment rents are currently low as a percentage of the income provided by the high-paying jobs that are being created. As more affluent young people enter the market, rents will continue to rise. Getting in on the ground floor makes for a great investment.
- Charlotte is growing to meet the new influx: Nearly 20 skyscrapers were started in Charlotte in the last decade. Even so, there is an increasing crunch. Office listings are down almost 25% over last year, while demand has gone up 14%. Prices in the city are up 8% year-to-year. This means that there is going to be room for more growth and more expansion, and that the market is strong.
All of this adds up to a city whose vitality is matched only by its growth. Charlotte has a solid base with established businesses, and it continues to attract the right sectors to fuel both residential and commercial real estate growth.
Key Charlotte Neighborhoods for Real Estate Investment
At Origin, we only look at neighborhoods that are ready to grow for us and our partners. In Charlotte, this includes:
Central Business District: The CBD, also known as Uptown, is home to corporate headquarters, an enormous amount of office space for all industries, sports arenas and stadiums, hundreds of restaurants, and high-density residential areas. It is the heart of the city, with an increasing number of luxury apartment units for the new generation of workers.
- Midtown/Dilworth: Located just minutes outside Uptown, the Midtown and Dilworth neighborhoods are home to great restaurants, boutique shopping, gorgeous scenery, and growing mixed-use development. This is an increasingly trendy area for startup employees to live and work.
- Plaza-Midwood/NoDA: Northeast of Uptown, these funky and eclectic neighborhoods are a draw for residents who want to live outside the downtown area in . A future home of light rail stops, this area is set to grow for people who are concerned about commutes. More businesses are popping up here and space is being converted for commercial and residential use. Overall, this is an up-and-coming neighborhood.
- SouthEnd: Located on the southern edge of the CBD, South End has grown to be a highly desirable investment market, driven by the establishment of the LYNX light rail Blue Line. Outsized demand by the millennial generation for convenient living accommodations has resulted in the development of over 7,000 multi-family units, the creation of one of the city’s most desirable retail and restaurant corridors, and the development of nearly 500,000 square feet of office space since 2007.
- University Research: The University of North Carolina at Charlotte (UNC Charlotte) and the University Research Park anchor University City, Charlotte’s second largest employment hub. University City houses more than 150,000 residents and 74,000 jobs and contributes over $8.4 billion annually to the regional economy and has become a catalyst for technology job creation throughout the region. The recent completion of I-485 and the extension of the Lynx Blue Line from the CBD have greatly improved its connectivity and will expedite future growth.
- Southpark: South Park has developed an indisputable reputation as Charlotte’s premier live, work, and play location. The solid reputation of SouthPark has steadily evolved over time from its roots as the farm of a prominent Charlotte family to its present personality as an excellent location for Corporate America and Charlotteans to call home. The cornerstone of the submarket is the SouthPark Mall, a 1.6 million square foot, Simon-owned mall that is highly regarded as the finest shopping between Washington DC and Atlanta.
- Ballantyne: A diverse, exciting neighborhood south of downtown, Ballantyne is home to many corporate regional offices, and the space available is increasingly enticing for businesses and startups that have been crowded out of downtown. Investors are increasingly looking at Ballantyne as a high-growth area.
To say that the Charlotte real estate market is growing is an understatement. In a generation’s time, this dynamic city has established a strong base of traditional economic power and is now attracting the next wave of exciting entrepreneurs. It has become arguably the region’s most important city. At Origin Capital Partners, we understand what it takes to thrive in Charlotte, and we are perfectly positioned to make the right investments for our partners.
If you are a real estate investor looking to broaden your portfolio and join other investors in major developments in Charlotte or other markets, Origin Capital Partners would be excited to work with you. At Origin Capital Partners, we have a powerful connection with the cities we invest in and we understand what makes them tick. We know which areas are booming and which commercial and residential investments will make the most sense moving forward. Our Funds deliver consistent returns, because we know how to make sense of the real estate market. Contact us today to talk about how your investments can grow with the city.
