By Andy Westby, President, Managing Broker & Auctioneer | Goldmark Commercial Real Estate
If you’re trying to understand where the market is headed, one of the first places I look is permits. They tell us what developers are confident enough to build today.
Right now, the signals are mixed.
Office permits in the FM metro dropped about 65 percent year over year in Q1. At the same time, retail permits jumped 2500 percent, and industrial permits were up nearly 379 percent.
That’s not subtle. That’s a clear shift in where capital is going.
Developers Are Being Selective
Developers and owner-occupiers are not stepping away from the market. They are just being more targeted.
Office construction has slowed because demand is still working through existing inventory. There is less incentive to add new supply when vacancy remains elevated, and leasing has been slower.
Retail and Industrial Are Attracting Investment
On the other hand, retail and industrial are seeing more confidence.
Retail has stabilized, and in some cases, retailers are betting on well-located projects and strong demographics. Industrial is even more straightforward with most projects being owner-occupiers building for their own business, as spec industrial has remained low over the past 12+ months. With strong leasing activity and tightening inventory, those are encouraging signs we may start to see new spec development on the horizon.
What This Tells Us About the Market
Permits are one of the clearest indicators of where the market is going, not just where it has been.
Right now, they are telling us that the market is not slowing down. It is shifting.
Capital is moving toward sectors with stronger demand and clearer near-term returns.
What This Means for Clients
If you are an investor or developer, this is a reminder to stay aligned with where demand is actually happening, not where it used to be.
If you are a tenant, these trends can influence future availability. More industrial development may create options down the road, while limited office construction could eventually tighten supply once demand stabilizes.
From my perspective, this is a healthy adjustment. Markets evolve, and the data is showing us exactly how that evolution is playing out.
Final Thoughts
Understanding trends like this is exactly why we produce our Quarterly Connect report. At Goldmark Commercial, we pride ourselves on delivering clear, data-driven insights so our Clients can navigate changing market conditions with confidence. To stay up to date on what’s happening across the FM market, you can sign up to receive our Quarterly Connect report.