Improving economy brightens outlook for commercial real estate
As the U.S. economy continues to improve, so does the commercial real estate market, according to the National Association of Realtors (NAR).
“The job market has been the bright spot of the economy this year as employers are feeling more confident about their growth prospects and adding to their payrolls,” Lawrence Yun, NAR chief economist, said according to Realtor.org. “This gradual turnaround from being overly cautious to more optimistic should slightly boost the demand for leasing and purchase activity as well as new construction projects in the upcoming year.”
According to the NAR and Realtor.org, retail space vacancies are expected to decline 0.2 percent due to gains in personal income and consumer spending. Industrial space vacancies are also expected to decline behind rising exports and a lower trade deficit. Office vacancies are expected to remain unchanged for the next year.
Yun, according to Realtor.org, says there’s also a demand for more rental housing. Construction on new multifamily housing has also increased.