Modest Job Growth Boosts Commercial Real Estate
Fundamentals are gradually improving in all of the major commercial real estate sectors, according to the National Association of Realtors® quarterly commercial real estate forecast. After a prolonged impact from the recession, modest job growth is boosting the economy and fueling the demand for commercial real estate.
“Ongoing job creation, which is at a higher level this year, is fueling an underlying demand for commercial real estate space, assisted by a steady increase in consumer spending,” says Lawrence Yun, NAR chief economist. “The pattern shows gradually declining commercial vacancy rates, with consequential but generally modest rent growth.”
Yun expects the economy to add 2 to 2.5 million jobs both this year and in 2013, on the heels of 1.7 million new jobs in 2011, assuming a new federal budget is passed before the end of the year.
NBI Properties co-owner Jayme Nabors said the forecast is good news for the Emerald Coast, which continues to attract the interest of investors and has a strong demand for apartment rentals.
“We’ve seen an upswing in multifamily housing and commercial real estate transactions for bigger properties,” said Nabors. “Unfortunately, commercial lending is still somewhat tougher for small businesses and we hope that restrictions will become less stringent on these borrowers as the economy continues to improve.”
Source: © 2012 Florida Realtors®