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SunBelt Growth Projections Could Foretell Favorable Commercial Real Estate Performance

February 26, 2025 / Chart of the Month

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Location’s critical role in the success of all real estate endeavors is widely acknowledged. One way to define a good location is the population growth of a region or metro. Illustrated in the chart, the U.S. Sunbelt population grew more than 3.5 times the growth rate of non-Sunbelt regions from 2014-2023. During that time in the 3-year, 5- year, and 10-year periods through 2023, Sunbelt institutional real estate outperformed non-sunbelt real estate by over 300 basis points in each period and industrial, multifamily, retail, and office rents all grew faster in sunbelt regions vs non-sunbelt. Projections for the next 10 years call for this population growth rate difference to accelerate with Sunbelt population expected to grow at 22 times the rate of non-sunbelt regions.

Source: Original chart and data courtesy of Clarion Partners, the Sun Belt’s Ongoing Boom, April 2024



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