Evansville is Indiana’s third largest city and has a low cost of living and high quality of life compared to many other communities in the area. “We see development occurring in most parts of our community: downtown and on the east, west and north sides of town,” says Steve Martin, corporate secretary and treasurer of Evansville-based RE/MAX Commercial Services.

On the east side of Evansville, development is tracking north along Interstate 164 and toward Newburgh. Recent developments in this market, which has a growing population and high disposable incomes, include Tri-State Orthopedics new medical facility and Deaconess’s new Cancer Center. “The east side is the primary shopping district with the Eastland Mall, the largest regional mall in southern Indiana,” Martin says.

“The multifamily market is seeing new development despite high vacancy rates for some product types,” Martin says. “The vacancy rates for family and low-income properties range between 10 percent and 12 percent while senior housing seems to be in the 5 percent range.” During the past couple of years, vacancies in the city have risen but have stabilized now.

“Most new development historically has been on the east side although there has been some activity on the west and north as well,” Martin says. Curtis Investments has garnered a lot of interest and support in its downtown housing proposal. On the east side, Fort Wayne, Indiana-based Kendall Development is developing a new apartment project at Charleston on the Lake, and SC Bodner Company recently completed 204 units, or 75 percent, of Brooklyn Place.

In the office market, vacancies will continue to climb in the foreseeable future. The market’s current, overall vacancy rate is 15 percent. Downtown vacancy will increase when Old National Bank and the Vectren Corporation’s new corporate headquarters are complete. “We believe downtown vacancy rates will increase as these two major office users move into their new buildings. The completion of these two major projects will create many interesting opportunities for tenants and will likely keep rental rates flat into the future,” Martin says.

Retail remains a strong sector in Evansville with an overall vacancy rate of 8 percent. Expansion has been healthy on the east side with the completion and leasing of the new Target Greatland Pavilion and the new Schnuck’s-anchored Lakeside Commons.

“The leasing of the new space on the west side has accelerated, and the large amounts of vacancy are filling,” Martin says. The new west side Wal-Mart Superstore (more than 200,000 square feet) is anticipated to start construction in the west side Eagle Plaza Retail development, which will kick start more growth in the area.

The industrial market has been slow, and the vacancy rate remains consistently high between 13 percent and 15 percent. “The majority of vacancy is in smaller facilities or older buildings.” Martin says. On the north side of town, Highway 41 is the defined industrial corridor. When the new sewer line is complete, currently in the planning and land acquisition stage, development should accelerate in the area.

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