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Albuquerque Ranks #1 Top as Cheapest CRE Investment City

With the cost of commercial real estate and borrowing both on the rise, the search is on for investments and deals that make sense. CREXi recently identified six cities in the United States that could be designated as the cheapest for CRE in 2023.

In determining its rankings, the company examined data from PwC/Urban Land Institute’s Emerging Trends in Real Estate 2023 and added insights from CREXi Intelligence. The following six cities are forecast to have steady GDP and population growth over the next five years. Five out of the six were identified by PwC and ULI as “The Affordable West,” and part of its “Backbone” designation. Additionally, rental housing is still affordable, while the cost of doing business remains low.

Albuquerque, NM

Albuquerque is more than a tourist destination. CREXi noted that it boasts a growing tech industry, with players like Airbnb and Netflix having a presence in the region. Additionally, Metropolitan Albuquerque ranks fourth in the nation in construction jobs added over the past 12 months, representing a 15% increase year-over-year.

Madison, WI

PwC dubs Wisconsin’s capital city as “Niche,” promoting its “Eds and Meds” features. The economy of this midwestern city is driven by technology, healthcare and education. WalletHub ranks Madison as the fourth best city for STEM jobs, ahead of other tech centers like San Francisco and Raleigh.

Sacramento, CA

Though overshadowed at times by Los Angeles and San Francisco, Sacramento’s low cost of living and proximity to Silicon Valley and the Bay Area’s tech markets make it a decent place for investment. CREXi (with input from Cushman & Wakefield) notes that multifamily vacancy is low, industrial absorption high, and the office market offers opportunities for tenants and buyer-investors.

Spokane, WA/Coeur d’Alene, ID

Spokane is known for its healthcare industry and historic buildings that have been transformed into unique shopping and dining destinations. Nearby Coeur d’Alene offers access to outdoor recreation opportunities surrounded by abundant lakes and mountains. Overall, the healthcare and social assistance industries are growing at a fast pace in this region.

Tacoma, WA

Tacoma holds its own when it comes to CRE investment potential. Recent redevelopment efforts are revitalizing the urban core while maintaining historical charm. Investors and tenants are attracted to the region due to land availability, good highway access, lower rents, housing affordability and proximity to Seattle and Portland, OR.

Tucson, AZ

Tucson offers thriving industries like aerospace and defense, education, technology and healthcare. A diverse economy also offers benefits for commercial real estate investors, including access to domestic and international markets and trained employees from nearby universities. Lower housing costs and large job opportunities also add to Tucson’s attraction as an investment destination.

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