24 May 13
Cost constraints among corporate occupiers and federal government sequestration led to a slowdown in the pace of overall demand in Q1 2013 compared to Q4 2012. Occupiers in major markets are using space more efficiently and embracing workplace strategies that incorporate workforce mobility. The average space per worker, currently estimated at 225 to 230 sq. ft., is under pressure as new space plans are implemented at 160 to 200 sq. ft. per worker. Demographic trends and increased demand for space in central areas pushed up rents in the downtown markets of Boston, Denver, Houston, Midtown Manhattan, Midtown South Manhattan, San Francisco and Seattle. Rent growth was also witnessed in suburban markets including Boston (Cambridge), Denver and San Francisco. Limited new supply contributed to the overall tightening of market conditions.
15 May 13
Despite mixed retail data in Q1 2013, there was guarded optimism that the economic headwinds were temporary and the modest recovery of retail property fundamentals would continue. Consumers kicked off 2013 beating consensus expectations for retail sales, but unusually cold weather conditions and payroll tax increases tempered March figures, resulting in a 0.4% contraction in month-to-month sales. The decline in March retail sales were felt across most sectors, however furniture
sales posted positive gains, another signal that the housing recovery has gained momentum. It is important not to extrapolate the drop in March sales as a bellwether for future contraction as February sales growth was unexpectedly strong, thus negatively impacting the March retail sales growth figure.
06 May 13
U.S. office market fundamentals continued a slow but steady improvement during Q1 2013, with overall vacancy decreasing by 10 basis points (bps) to 15.3%. Despite an uneven economic recovery and the sequester, the office sector remained in the early stages of its recovery, with modest occupancy gains spurred by employment expansion and limited supply. Officeusing jobs are projected to grow by 1.8% nationally in 2013, with San Francisco and Dallas outperforming at a 3% growth rate. Average asking rents have increased modestly for eight quarters and, with the exception of Q1 2012, net absorption has been positive for the past 12 quarters, according to CBRE Econometric Advisors. An improving housing sector and increased temporary hiring suggest the economy will gain further traction in the second half of 2013.
06 May 13
The U.S. industrial market continued to post strong quarterly growth as the availability rate experienced its tenth consecutive quarterly decline to 12.3% in Q1 2013, a 40-basis-point (bps) decrease from year-end 2012. Demand for industrial space led to 63 million sq. ft. of positive absorption, an increase of 11.5% from Q4 2012. Despite these improving fundamentals, the U.S.
economy may be showing signs of weakening in the near term. During Q1 2013, economic data was mixed; the March employment report, total retail sales and the ISM Manufacturing index were weaker than anticipated. Could this be another “false dawn” or mid-year slump similar to the past two years? Part of the slowdown can be attributed to the
sequester—a series of spending cuts mandated by the federal government—and tax hikes which took effect in March. Fiscal contraction will have some dampening effects on economic activity through the remainder of the year, although we continue to believe the pace of economic activity and drivers of industrial demand should get stronger during the second half of 2013 and into 2014.
05 Apr 13
The history of e-commerce and its profound effect on retailing, logistics and supply chain can be best illustrated by the rise and growth of Amazon.com. In 1994, Jeff Bezos, Amazon’s founder, discovered a startling statistic—the use of the internet was growing at a rate of 2,300% annually. At the time, 16 million people were online. A year later, at the founding of Amazon, that number had grown to 36 million. Today, the internet connects almost 2 billion people, or nearly one-third of the global population.
03 Apr 13
CBRE's latest ViewPoint, "Ten Tips for Healthcare Providers under the Affordable Care Act," discusses the implications of this landmark legislation on hospitals, ambulatory services and other healthcare systems – and how their real estate decisions and site selection processes may be affected in the future. This report is also featured in the April 2013 edition of Modern Healthcare.
15 Mar 13
On March 1, 2013, sequestration officially arrived, although fear of sequestration started well over a year ago. Concerns over federal government spending cuts started when the congressional “super committee” failed to reach consensus by December 31, 2011. The failure triggered automatic federal budget cuts, known as sequestration. Details on budget reductions have been unclear, driving uncertainty into the economy and commercial real estate markets. Adding to the uncertainty, the U.S. faced various political and fiscal events in 2012 such as the debt ceiling debate, the so-called fiscal cliff, national elections, a debt
downgrade, the near shutdown of the Federal Government, the eurozone crisis and a slowdown in China.
27 Feb 13
What current office market trends are important to occupiers? Office markets continue to tighten, presenting challenges for occupiers who need to expand or whose leases are up for renewal over the next few years. The national office vacancy rate declined to 15.4% in Q4 2012, from 16.0% in Q4 2011, meaning that more markets are reaching equilibrium. Although occupiers are increasingly focused on shrinking their overall office footprints through more efficient use of space and the shedding of excess space, modest demand will continue to drive office vacancy levels downward during 2013. New office construction is increasing, but is not enough to widen the gap between supply and demand.
21 Feb 13
Retail market fundamentals improved modestly in Q4 2012, as the national availability rate reached 12.8%, a decline of 30 basis points (bps) on a year-over-year basis. Overall, retail market fundamentals remained sluggish in 2012, but have been trending in the right direction since the retail recovery gained traction in 2011.
20 Feb 13
This new report, produced by CBRE Econometric Advisors, combines 13 insightful U.S. trends into a must-read guide for the coming year.