Economic conditions should mean a healthy level of growth for the commercial real estate industry through 2017. That’s the conclusion of a study by the Urban Land Institute (ULI) Center for Capital Markets and Real Estate. The report is the result of a survey of 49 top economists and analysts from industry organizations. The latest reading of the years ahead is less bullish than a previous report in April 2015 but says that there should be three years of favorable conditions for the market. Commercial volume to rise for next 2.5 years with prices up 10 per cent in 2016 and 6 per cent in 2016.
For apartments, vacancy rates are expected to increase slightly to 4.8 per cent in 2016 and 5 per cent in 2017; however, these forecasts remain below the 20-year average vacancy rate. Apartments are also expected to show consistent rental rate growth above the 20-year average of 2.7 per cent. Rents are expected to rise by 4.6 per cent in 2015, then moderate to 3.5 percent in 2016.
Steve Randall