RALEIGH – Looking ahead to 2023 is a sobering exercise, said Brian Leary, the chief operating officer at Highwoods Properties, who spoke to an audience at the Launch 2023 event in downtown Raleigh on Wednesday.
“It is sobering,” said Leary, noting that the year ahead projects to be one where there are projected negative returns in commercial real estate.
Still, said Leary, “Raleigh is better than the U.S.”
And there’s no better place to be than in Raleigh, said Leary, as we face the uncertainty that 2023 is going to bring to the local economy.
Because of that, there’s “tremendous opportunity” in the region, said Leary, noting that there is good news, because what is happening across the U.S. economy is self-inflicted, to some degree.
Still, changes could be coming in 2023, said Leary.
“For the economy to do what the Fed wants it to do, 4 million jobs have to come out of it,” said Leary. “We have a policy that is meant to take steam out of our engines, wind out of our sales, and jobs out of our economy.”
In North Carolina, that could mean 50,000 people lose their jobs, Dr. Michael Walden predicted on Wednesday at an earlier event.
And that could mean that companies look to the Zoom screen when considering which workers could be cut.
“Productivity is down,” said Leary, relaying the message that his company is hearing from their office tenants that they may soon require employees to return to office locations.
50,000 people to lose jobs in NC when recession hits in late 2023, economist warns
Housing remains a concern into 2023
Raleigh’s housing market is fascinating at this moment, said Leary. That’s because while Raleigh ranked 6th on a list of the top housing markets to watch in 2023 in an October 2022 report from Urban Land Institute and PWC rankings report, there’s now clear indication that buyer and sellers are going to be doing battle to come to a deal in 2023.
And, the battle to secure housing may extend to the rental market, as well, noted Leary.
“Rents are still going up, not as much as they were,” said Leary. “We delivered 400,000 units of multifamily, in 2022, and in 2023, we’ll deliver 490,000 multifamily units.”
But, said Leary, that won’t meet the need. Not even by half, as he said there are more than 1 million more housing units needed in the United States economy.
Economist: 2023 to be ‘roller-coaster’ year for Triangle, NC economy
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Editor’s Note: WRAL is a sponsor of the Launch 2023 event and has been a sponsor for prior Launch events organized by the Raleigh Chamber. Watch today’s event live here on WRAL.com.
