Durham, NC Economic Overview
Strategically perched at the heart of North Carolina, the City of Durham, or the Bull City, is a confluence of education, creativity, industry and innovation. It got its name from Dr. Bartlett S. Durham, the man who donated his land for a railroad station. Although the railroad station laid its initial foundation, it was a thriving tobacco industry that put Durham on the map. It was incorporated as a town in 1869 and has served as the county seat of Durham County since 1881.
Durham is a welcoming community that seems to be always open to something new. It is a key location within the Raleigh-Durham-Chapel Hill Research Triangle Park (RTP) (or just the Triangle) and a nexus for art and culture. In 2016, Durham ranked 48 on the list of best places for business and career, on Forbes’ list.
The economy of Durham is defined by three major industries: technology, healthcare and education. Durham hosts the RTP, a high-tech research and development center, and several leading companies in technology like Cree and IBM. Also dubbed the City of Medicine, Durham has six major hospitals and an unrivalled physician-to-population ratio that is close to 4.5 times better than the national average. Finally, Durham education sector has employed a significant portion of the town’s workforce and continues to provide highly-skilled labor for its industries. The gross metro product of Durham in 2016 was about $36.6 billion.
Durham, NC Commercial Real Estate Market
The Durham commercial real estate market is often analysed in tandem with that of its neighbor Raleigh. Notably, the industrial side of this combined market has been tight for the last few years, due to high tenant demand and short supply of industrial space. In the first quarter of 2017, the industrial vacancy rate of the Raleigh-Durham industrial market stood at 7.0%, which represented about 4.4 million square feet of vacant space, despite a negative net absorption rate of 234,301 square feet of industrial space on the Triangle flex submarket. The market has yet to fully recover from the 1.3 million square feet of industrial space vacated by GlaxoSmithKline (GSK) in 2016.
Durham office space is also in high demand, with low vacancy rates, of less than 2%, in the last six quarters.
Downtown Durham office space registered a vacancy rate of 1.3% in the first quarter of 2017 and a positive net absorption rate of 38,038 square feet of office space. The average rent price per square foot was $28.77. The South Durham office submarket is the largest of the region, and showed a vacancy rate of 3% and a positive office absorption rate, in the first quarter of 2017. About 76,000 square feet of space were under construction in the first quarter of 2017 and the average rental rate of $21.94 was significantly lower than in the Downtown Durham submarket.
At just $14.53 per square foot of office space, the small North Durham office space submarket is the most cost-effective market for tenants. However, it had the highest vacancy rate, of 28.9%. The general lack of large Class A properties on the Triangle office market is expected to be offset by the 1.8 million square feet of office space that is under construction, as of mid-2017.
Durham, NC Office Sales Volume
Data provided by Yardi Matrix, for properties larger than 50K SF, which sold at over $5M.
Durham, NC Office Transactions
Data provided by Yardi Matrix, for properties larger than 50K SF, which sold at over $5M.
Durham, NC Commercial Inventory Breakdown
Total: 20,627,253 SF
By square footage range:
- 50k to 100k SF: 5,182,766 SF / 25.13% of total office
- 100k to 500k SF: 12,062,640 SF / 58.48% of total office
- 500k to 1M SF: 1,198,809 SF / 5.81% of total office
- > 1M SF: 2,183,038 SF / 10.58% of total office
- Class A: 11,104,499 SF / 53.83% of total office
- Class B: 8,784,253 SF / 42.59% of total office
- Class C: 433,589 SF / 2.1% of total office
Employment in Durham, NC
Durham’s unemployment rate has remained lower than the national average since the turn of the century. It is now down to 4.4%, from a peak of 8.5% in 2010. Job growth in Durham is about 2.25%. Jobs in health care, education and research industries are well-paying. That explains why the annual average wage of Durham residents is higher than the national average.
- Health care and social assistance industry The largest Raleigh & Durham workforce, of about 60,580 workers, is in the health care and social assistance industry. Duke University and its vast Medical Centre is the biggest employer with over 40,000 employees;
- Scientific, research and technology industry More than 48,000 workers in Durham are employed in the scientific, research and technology industry. About 40,000 of these workers are on permanent employment at the RTP. It is estimated that the RTP has incubated about 1,800 startups in the last 50 years. Major employers at the Triangle are IBM Corporation, GSK and Cisco Systems Inc;
- The wholesale trade sector in Raleigh & Durham has employed over 25,000 workers. Lastly, The Durham Public Schools had employed 4,600 workers in 2014.
Education in Durham, NC
Durham boasts of top-notch educational resources and opportunities. Durham Public Schools system serves in excess of 33,000 students and is the seventh largest in the state of North Carolina. The North Carolina School of Science and Mathematics, a pioneer public high school with an emphasis in mathematics and science, is located in the city.
Durham is also home to the esteemed Duke University, North Carolina Central University and Durham Technical and Community College.
Commuting Time in Durham, NC
Durham has the best commute time in the region partly due to its lower population compared to that of Raleigh in the Wake County. Therefore, getting anywhere around the Triangle is easy. The average commute time in Durham is about 23.3 minutes.
Although there are efficient and affordable public bus, commuter rail and light rail systems in the Triangle, using a car remains the most preferred means.
- Total Population257,232
- Male Population(47.0 %) 120,795
- Female Population(53.0 %) 136,437
- Median Age33.60
- Average Household Income$77,357
- Median Household Income$54,284
- Median Income Under 25$27,848
- Median Income 25-44$54,988
- Median Income 45-64$67,103
- Median Income Over 65$46,708
- Ashley Forest Demographics
- Bennet Place Demographics
- Cameron Woods Demographics
- Central Park Demographics
- Chapel Hill Road Demographics
- Copper Creek Demographics
- Crest Street Demographics
- Croasdaile Demographics
- Crooked Creek Demographics
- Darby Glen Demographics
- Downtown Durham Demographics
- Duke East Campus Demographics
- Duke West Campus Demographics
- Eagle's Pointe Demographics
- Folkestone Demographics
- Golden Belt Demographics
- Knollwood Demographics
- Old West Durham Demographics
- Parc at University Demographics
- Parkwood Demographics
- Research Triangle Park Demographics
- Stadium Heights Demographics
- Summer Meadow Demographics
- Taylor Estates Demographics
- The Landing at Southpoint Demographics
- Valley Run Demographics
- Warehouse District Demographics
- Westgate Townes Demographics
Residential Rents in Durham, NC
When choosing the best place for a business, location research is very important – not only for the office, but also for the employees’ convenience.
The Durham rental market continues to grow due to rising demand. The population is growing and its attractive job market has overseen a positive net migration to Durham. In May 2016, the average apartment rent in Durham was $1,211 per month, which represented a 2.5% ($30) rise from late 2016 to mid-2017. The increase was higher for two-bedroom apartments (5.5%) than for one bedroom apartments (2.1%). In general, a one-bedroom apartment went for $1,062 and a two-bedroom apartment went for $1,327.
Durham, NC Average Rental Price, May 2019
- $ 1,074/mo
- Studio: $ 1,004
- 1 Bedroom: $ 986
- 2 Bedrooms: $ 1,111
Durham, NC Rent Trends
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