Commercial Real Estate: A slow grinding path

Atlanta Business Chronicle by Michael Bull, Bull Realty

Date: Friday, February 10, 2012, 2:08pm

Summary: Each major commercial U.S. real estate sector is expected to improve given that: job growth continues, the European debt crises are resolved and the presidential election doesn't scare investors.

Key Quotes:
Apartments should be the strongest asset class this year.

The national industrial market has experienced seven consecutive quarters of positive net absorption, and the sector will again experience improved fundamentals in 2012, as some corporations bring manufacturing back to the U.S. and the Panama Canal is widened. Note that Savannah will not immediately benefit from a wider Panama Canal.

Unlike past downturns, the CBD markets are rebounding better than their suburban counterparts. In particular, medical office properties will continue to be a favored asset class. See also A prescription for Atlanta commercial real estate investment (and Savannah).

The retail market was hit hard by the recession, but is getting back on its feet.

Read the full article at: Commercial Real Estate: A slow grinding path

A. Joseph Marshall
Coldwell Banker Commercial
Commercial Real Estate Advisor
Savannah, Ga

Growth in Commercial Real Estate Markets Expected in 2012

press release

WASHINGTON, DC, Nov 28, 2011 (MARKETWIRE via COMTEX) 

Summary: Commercial real estate growth was flat in 2011, but economic growth and more jobs signal a stronger 2012.

Key Quotes:

Lawrence Yun, NAR chief economist, said there is little change in most of the commercial market sectors. "Vacancy rates are flat, leasing is soft and concessions continue to make it a tenant's market," he said. "However, with modest economic growth and job creation, the fundamentals for commercial real estate should gradually improve in the coming year."

The commercial real estate market is expected to follow the general economy. "Vacancy rates are expected to trend lower and rents should rise modestly next year. In the multifamily market, which already has the tightest vacancy rates in any commercial sector, apartment rents will be rising at faster rates in most of the country next year. If new multifamily construction doesn't ramp up, rent growth could potentially approach 7 percent over the next two years," Yun said.

Vacancy rates in the office sector are expected to fall from 16.7 percent in the current quarter to 16.1 percent in the fourth quarter of 2012.

Industrial vacancy rates are projected to decline from 12.3 percent in the fourth quarter of this year to 11.7 percent in the fourth quarter of 2012.

Retail vacancy rates are likely to decline from 12.6 percent in the current quarter to 11.8 percent in the fourth quarter of 2012.

The apartment rental market -- multifamily housing -- is expected to see vacancy rates drop from 5.0 percent in the fourth quarter to 4.3 percent in the fourth quarter of 2012; multifamily vacancy rates below 5 percent generally are considered a landlord's market with demand justifying higher rents.

The full article can be read at Growth in Commercial Real Estate Markets Expected in 2012.

A. Joseph Marshall
Coldwell Banker Commercial
Commercial Real Estate Advisor
Savannah, Ga