Asheville, North Carolina's Commercial Market Finds Its Footing After Hurricane Helene

Written by:

Steve Marcinuk

Date:

29 May 2026

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Western North Carolina’s commercial real estate market has always operated by its own rules. Tucked into the Blue Ridge Mountains, Asheville has historically defied national trends, maintaining strong demand and low vacancy even when larger metros struggled. But since Hurricane Helene struck on September 27, 2024, the market has entered a period of recalibration that is testing that resilience in new ways.

Jessica Auge, CCIM, a commercial broker at Likewise Commercial Real Estate, a boutique woman-owned brokerage serving Western North Carolina, has a front-row seat to how the recovery is unfolding. Her observations paint a picture of a market that remains fundamentally sound but is navigating a more complex set of headwinds than it has faced in recent memory.

A Market That Plays by Different Rules

To understand what is happening in Asheville today, it helps to understand what makes it structurally different from most commercial markets. The city sits in a mountain geography that places hard limits on development. Infrastructure constraints tied to topography mean that new supply has always been difficult to bring online, keeping vacancy low and demand competitive across most asset classes.

That supply constraint has created a market where even during national downturns, Asheville has tended to hold up. The post-COVID office vacancy crisis that emptied buildings in cities across the country largely bypassed Western North Carolina. Office vacancy here remained low while other markets were converting empty floors into residential units or writing down asset values.

What Helene Changed

The hurricane introduced a variable that no amount of structural resilience could fully absorb. In the months since the storm, transaction volume has declined market-wide, and properties that would have moved quickly in prior years are now sitting on the market longer.

Development sites, land, redevelopment opportunities, mixed-use buildings in downtown areas, and industrial space are all taking longer to move forward. “Two years ago, you couldn’t find any industrial space,” Auge notes. “Right now, we’re seeing a lot more hit the market, and we’re seeing some of those assets sit vacant for longer periods.”

The slowdown is not solely attributable to the storm. Rising interest rates through 2024 dampened buyer activity broadly, and economic uncertainty has made developers more cautious about committing capital. But the hurricane’s effect on local business sentiment and property owner confidence has been a distinct factor layered on top of those national pressures.

The Cap Rate Disconnect

One of the clearest signs of a market in transition is the gap between seller expectations and buyer reality, visible in how cap rates are being priced and negotiated in Asheville right now.

Sellers, by and large, are holding the line. Auge recently spoke with an out-of-market investor who had fallen in love with the city while visiting and wanted to invest locally. His cap rate expectations were well out of step with what the market actually supports, a dynamic she sees regularly.

Properties are frequently listed at cap rates lower than what buyers will accept, and deals that close tend to settle at more realistic levels. This pricing friction is slowing deal flow without necessarily reflecting a deterioration in asset quality. When something is priced correctly and perceived as a genuine opportunity, competition among buyers remains real. “If it’s something that is perceived as a good deal, there is competition,” Auge observes.

Where Deals Are Stalling

Even well-positioned properties are struggling to reach the closing table. A retail corridor listing in Asheville illustrates the broader challenge facing the development pipeline. The property sits on a high-visibility stretch, carries adaptive reuse potential, and is priced within what Auge considers a realistic range. Offers have come in, supporting the valuation. Yet the deal has not closed.

The obstacle is not price alone. Construction costs have risen sharply over the past two years, and navigating local permitting and zoning has become more time-consuming and uncertain. “I think that developers are sitting on the sidelines right now, even with such an ideal, prime property,” she says.

Local Businesses Pushing Forward

While investors and developers wait, a different kind of buyer is showing more urgency. Local businesses that deferred real estate decisions through much of 2024 are now acting out of necessity.

These operators, including local nonprofits and small businesses, have concluded that waiting for ideal conditions is no longer viable. They sat on the sidelines through most of 2024, and by 2025, the need for space forced their hand. “Regardless of the higher interest rates and things costing more, these folks have a need,” Auge says. Many are moving forward with plans to refinance later if conditions improve. This segment represents a meaningful share of active deal activity at Likewise.

The Inventory Misconception

Perhaps the most persistent challenge Auge faces is correcting outside perceptions about what is actually available. Asheville’s reputation as a desirable destination leads many prospective tenants and investors to assume inventory exists that simply does not.

The food and beverage sector is a clear example. Asheville has a well-regarded culinary scene, and successful restaurant operators looking to expand are running into a hard wall. “We have some excellent restaurant operators that are growing and want more space and want additional locations, and we just do not have that space available for them,” Auge says.

Zoning adds another layer of complexity. Properties that might appear suitable for a given use often cannot accommodate it without a change-of-use process that brings its own timeline and uncertainty.

Office and Co-Working Trends

The office market continues to diverge from national narratives, though nuance is emerging. Vacancy remains low by most standards, particularly outside of downtown, where parking access helps properties move more quickly. A slight uptick in downtown office vacancy is notable but not yet a structural concern.

Co-working, which saw moderate post-COVID demand in Asheville, is showing signs of softening. Auge observes that these spaces were never as successful in Asheville as in other markets, but they are now struggling more to maintain occupancy. She notes that operators would likely find more traction marketing these spaces to single users. The shift reflects a broader return-to-office trend that is reducing the appeal of flexible shared space arrangements.

Asheville has long been described as a “bring your own job” market, with a high concentration of remote workers. That characteristic has not disappeared, but the balance is shifting as more employers call workers back.

Looking Ahead

The Asheville commercial market enters the second half of 2026 carrying both the weight of hurricane recovery and the uncertainty of a national economic environment that has made capital more cautious across the board. The structural factors that have historically supported the market, constrained supply, consistent demand, and quality-of-life appeal, remain intact.

What has changed is the pace. Deals that once moved quickly now require more patience, more negotiation, and more creative problem-solving around financing, zoning, and development costs. For local businesses with genuine space needs, the calculus has shifted toward action. For investors and developers, the sidelines remain crowded.

How quickly sentiment recovers will depend in part on interest rate direction and in part on how confidently the local economy rebuilds after Helene. For now, the market is moving, just more deliberately than it has in years.

About the Expert: Jessica Auge, CCIM, is a commercial broker at Likewise Commercial Real Estate, a boutique woman-owned brokerage serving Western North Carolina. Her practice focuses on commercial real estate in the Asheville area and the broader Western North Carolina region.

This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.