Louisiana Commercial Realty LLCOrleans Parish Commercial Real Estate

The commercial real estate market in Orleans Parish is currently 3.1 million square feet for lease and 3.7 million square feet for sale with a sale price of 266 million. The office category comprises the largest sector at approximately 50% of the space for sale or lease, followed by retail, shopping centers, industrial, land and multi-family with the smallest supply on the market.

orleans market pie

orleans market pie







Days On The Market

The statistic that sticks out is the Days On The Market, which is a leading indicator of the strength of the market. The office sector which normally averages 274 days on the market shows a dramatic shift to 35 days an the market. The latest office sector sale averaged $65PSF, a 15% discount from the 12 month average, and the latest lease averaged $12.90 PSF, a 20% discount from the $15.98 PSF average the last 12 months. The table below shows the data for the Orleans Parish market.

orleans parish market

orleans parish market


Sale Prices versus Lease Prices

Average asking sale prices range from a low for industrial sector property at $33 PSF to a high of $107 for shopping center property, which follows the premise of Cap Rate, in that a property is valued at a multiple of the income, and more specifically should be the present value of future income streams, adjusted for risk. Lease rates range from a low on industrial property of $3.84 PSF to a high of $15.90 PSF on office property. The retail sale price is a higher multiple of lease rates than office space since retail sometimes includes a percentage of sales and office space often includes free rent and tenant improvement expenses.


Sources: wwwlouisianacommercialrealty.com, LACDB










Louisiana Commercial Realty LLCThe best way a business can stay competitive is to utilize incentives offered by state and local governments. Louisiana offered tax credits to the movie industry several years ago and the result was a subsequent explosion in movies made here and a boost to the economy from payroll and visibility driving demand toward our tourism industry.

In Louisiana, tax credits were targeted to filmmakers, and by the end of the 2000's, the incentives helped establish Louisiana as the #3 U.S. movie production market. In 2005, Louisiana extended tax credits to video game developers in the state. State leaders recognized that digital entertainment held the potential to create even more permanent jobs than movies, and a 2009 law extended the reach to software development in general, with a 35 percent refundable tax credit in Louisiana-based payroll and a 25 percent refundable tax credit on software product costs.

Louisiana offers the highest incentives for digital media in the country, and the tax rebate of 35% of expenses means that if a software company employs engineers at a salary of $100,000 annually, the company will receive a rebate check for $35,000 from the state of Louisiana.

Qualifying Development Products include:

Eligible Labor Expenses:


Digital Media Incentives Bring In Top Companies

General Electric

In February of 2012, Brackett Denniston, GE senior vice president and general counsel, joined state and local leaders to announce the creation of the GE Capital IT Center of Excellence in New Orleans. “We took our time to select a location for this important center,” said Denniston. “We looked all over the country but, after much consideration, New Orleans rose to the top of our list.” The center will be home to 300 high-quality technology jobs and serve as a major resource for GE Capital employees across the nation. Executives announced GE Capital will occupy 60,000 square feet of office space in the New Orleans Central Business District.












On August 15, 2011, Gameloft announced it would open a game development studio in New Orleans and deliver at least one new game title developed entirely at the studio in its first year. Employment will grow to nearly 150 jobs at the New Orleans studio in the next few years, with pay averaging more than $60,000, plus benefits.

Electronic Arts

In 2012, the Electronic Arts moved into the newly-constructed 94,000-square-foot Louisiana Digital Media Center on the LSU main campus. EA now employs nearly 500 workers during the school year. In addition to the LSU students who serve in part-time positions at the center, EA has had success recruiting others in the Baton Rouge area to test children's games and casual games more popular with adult women. Game testers at the center in Baton Rouge coordinate work on a daily basis with studios across the globe, including facilities in Stockholm, London and Bucharest.


"This public-private partnership with LED, IBM and LSU is a powerful example of the triangulation between industry, government and academia that elevates the state's role as a national leader in economic development," said LSU College of Engineering Dean Richard Koubek. "LSU's College of Engineering is committed to developing a mutually beneficial partnership with IBM and LED that stimulates economic growth and helps to meet the workforce development needs of the state."

In addition to long-term workforce solutions, LED offered the company a $17 million grant to reimburse relocation, recruitment and internal training costs; a $5.5 million incentive equivalent to the state's Quality Jobs program for a portion of the IBM center's employment over 10 years; a $5 million grant to offset facility operating costs over 10 years; and the recruitment, screening and training services of LED FastStart®.

LED offered a $30.5 million performance-based grant consisting of state, local and federal funding to build an eight-floor office building as part of a new, mixed-use urban development on Baton Rouge's riverfront. In addition to new Class A office space and 600 dedicated parking spaces, the development would include an 11-floor residential tower and a private recreational terrace joining the buildings above a multilevel parking garage. Leveraging resources of the Baton Rouge Area Foundation, Louisiana secured BRAF’s commitment to build and manage the $55 million total project through its affiliates, the Wilbur Marvin Foundation and Commercial Properties Realty Trust.

Top Digital Media Companies

Gigaom, with 5.5 million readers, researches and publishes a list of the top ranked digital media companies:

News Corp
Walt Disney
NBC Universal
Cox Enterprises
Activision Blizzard
Universal Music Group
Monster Worldwide
National Football League
Time Warner
Major League Baseball
Warner Music
Electronic Arts
New York Times
Classified Ventures
Advance Publications
Yell Group
Demand Media
FriendFinder Networks
United Online


Digital companies can be identified by the NAICS codes 511210 for software, 512191 for video post-production, and 519130 for Internet publishing. The North American Industry Classification System (NAICS) is the standard used by federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. business economy. NAICS was developed under the auspices of the Office of Management and Budget (OMB), and adopted in 1997 to replace the Standard Industrial Classification (SIC) system.


Sources: www.louisianacommercialrealty.com, Census Bureau, Gigaom

Three trends emerged in the commercial real estate office market in the New Orleans area in 2013.


 The Market

The available supply of office space for lease in Orleans Parish is 2.7 million square feet, with 1.8 million square feet for lease and 922,000 square feet for sale. There are 366 active properties with an average asking lease rate of $15.90 per square foot and actual lease rate average of $12.90 per square foot and average sale price of $65 per square foot. The amount of office space in Orleans Parish currently for lease is the same as the average the last 12 months at 1.8 million square feet, down from 1.7 million square feet on average the last 24 months. The amount for sale has increased 54% to 922,000 square feet, from an average 597,000 square feet the last 12 months and 662,000 square feet the last 24 months. The strength in demand is most visible in the days on the market, which averaged 35 days the last months, compared to 274 days the last 12 months and 296 days over the last 24 months.

With 1.8 million square feet supply in leasing space about the same as the average the last 12 months, and leased prices shrinking almost 20%, the shortened days on the market tells us that there is price elasticity in the leasing market, meaning as prices drop, there is an increase in demand, assuming supply is constant. Some markets are not as elastic, such as in Kenner or New Orleans East, meaning that a reduction in price does not bring increased demand. These markets are more inelastic.


days on the market -office space Orleans Parish

days on the market -office space Orleans Parish


Office Market In Jefferson Parish

There is currently 1.4 million square feet of available office space in Jefferson Parish, with 891,000 square feet for lease at an average asking price of $17.25 per square foot and actual lease rate of $15.07 per square foot, and 539,000 square feet for sale at an average asking price of $101 per square foot and actual sale price of $91 per square foot. The supply of office space for lease has plummeted 41% to 891,000 square feet from 1.5 million square feet on average the last 12 months. The supply of office space for sale has increased 26% to 538,000 square feet from 425,000 square feet on average the last 12 months. The trend toward more properties for sale is due to the strengthening of prices, which causes property values to rise and owners selling to take advantage of the increased prices, with the resulting increase in square footage of office space for sale. Another trend is a result of the 41% decline in leasing square footage available, causing lease asking prices of $17.25 per square foot, higher than the 12 month average of $17 per square foot and the $16.93 per square foot on average the last 24 months.


Office leasing in Orleans Parish is pulling demand from Jefferson Parish, as a result of competitive pricing averaging actual lease rates of $12.90 per square foot, compared to $15.07 per square foot. Demand is high in Orleans Parish for lease and sale of office space, as evidenced by the 90% drop in days on the market over the last 12 months.



Sources: www.louisianacommercialrealt.com, LACDB




Louisiana Commercial Realty

Commercial Real Estate Experts
Robert Hand, MBA, CCIM, SIOR
Licensed in Louisiana & Mississippi
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