Commercial Real Estate Markets Have Settled in for the Long Haul
August 3, 2017 | Calvin Schnure | REIT.com
Commercial real estate markets appear to have settled in for the long haul. New supply and the growth of demand are roughly balanced in most property sectors, vacancy rates are stable and rents growing modestly. The latest data from CoStar on net absorption and completions during 2017:Q2 help alleviate earlier fears that a supply wave would flood the market. Instead, supply and demand appear closely matched—although the retail property and office markets did see a bit of an uptick in vacancy rates.
Vacancy rates in industrial, office, and retail markets are at or near their lows for the cycle, and are 15 to 30 basis points lower than a year ago. Apartment vacancy rates have turned back down in 2017, declining 27 basis points from Q1 and reversing a good portion of the increase that took place last year.
