Market Overview
Southern Utah’s commercial market closed 2025 with steady fundamentals across all property types.
Population growth, business expansion, and new infrastructure continue to support long-term stability.
Key indicators at year-end:
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Office Vacancy: ~3.3%
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Industrial Vacancy: 7.8% (true rate near 1.0%)
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Retail Vacancy: 2.5%
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CAP Rates: 6.0–7.0%
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Land Values: $16–24 per SF
Sector Highlights
Office:
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Steady absorption with strong activity in professional and medical sectors.
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Class A rents holding firm at $18–$22 NNN; new inventory (Kiln, Enviroguard) performing well.
Industrial:
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Small-bay product remains undersupplied.
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Cedar City Highway 56 and Southern Parkway corridors are the main expansion nodes.
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Owner-user activity remains elevated.
Retail:
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Ongoing resilience in neighborhood and service retail.
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New projects at River Crossing and Bluff Street enhance tenant variety.
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Lease rates average $18.50–$26.50 NNN depending on frontage.
Investment Insights
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Steady CAP rates reflect investor confidence amid national volatility.
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Private capital and 1031 exchanges remain active in the $1–$5M range.
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Land speculation increasing in annexed and infrastructure-ready parcels.
2026 Outlook
Expect a measured pace of construction as developers focus on quality and pre-leased projects.
Industrial and medical office remain the top-performing sectors, while retail should continue steady growth anchored by population gains.
“Southern Utah remains a fundamentally strong market—limited supply, healthy demand, and business-friendly growth fuel opportunity.”
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