Commercial Real Estate Recovery Still Slow

Orlando, FL, Nov. 12, 2012 -- Despite the residential real estate market showing signs of progress and the economy steadily improving, the commercial market continues to recover at a sluggish pace, according to the National Association of Realtors.

However, a positive outlook endures as commercial real estate remains a solid investment, according to NAR Chief Economist Lawrence Yun at the 2012 Realtors Conference and Expo.

“The commercial real estate market was an innocent bystander of the housing crisis, and the broad credit tightening has made it much longer for the market to recover,” said Yun.

“Commercial real estate depends on an expanding economy, as well as available credit, something that is extremely tight right now. However, despite some challenges in the market there are hopeful signs as commercial investments increase, most notably in the multifamily sector.”

Yun pointed out that most commercial sectors are continuing at a slow recovery pace. Demand for office space is modest. Yun predicts office completions will be low through the next year. Similar scenarios exist in the industrial and retail sectors, as well.

The multifamily sector maintains steady growth and vacancy rates continue to drop while rents firm up.

Yun highlighted that multifamily is the only sector where rents are outpacing inflation. Apartment vacancy rates have continued to decrease mostly due to young people who cannot obtain a mortgage, as well as families who encountered foreclosure.

Calvin Schnure, vice president, research and industry information at NAREIT, voiced similar predictions for the multifamily sector. “Pent-up demand continues to drive the multifamily sector while new supply falls short,” said Schnure.

“Market conditions for multifamily have tightened since the housing crisis. There will continue to be improvement in all commercial sectors over the next few years; meanwhile very little supply will have much more demand on the market.” 



Other Archived Articles

Home Builder Sentiment Ticks Down in January   Full Article
Washington, DC, Jan. 20, 2015 -- U.S. homebuilder sentiment edged lower in January but remained well in positive territory, according to the National Association of Home Builders.

Remodeling Market Index Hits Record Level   Full Article
Washington, DC, Jan. 20, 2015 -- The National Association of Home Builders’ Remodeling Market Index posted a record-high result of 60 in the final quarter of 2014.

Fuse Alliance Names Gordon Executive Director   Full Article
Laguna Niguel, CA, Jan. 20, 2015 -- Fuse Alliance, a member-owned organization of professional, commercial flooring contractors, said it has named Geoff Gordon as executive director.

RAK Ceramics Selling Stake in RAK Laticrete   Full Article
United Arab Emirates, Jan. 20, 2015 -- RAK Ceramics plans to sell its stake in RAK Laticrete as part of the company’s strategy to focus on core assets, the firm said.

Julius 'Bud' Shaw, Founder of Shaw Industries, Dies   Full Article
Cartersville, GA, Jan. 20, 2015 -- Julius Clarence "Bud" Shaw, age 85, founder of Shaw Industries, died Jan. 16.

TISE East Changes Location, Dates   Full Article
Dallas, TX, Jan. 20, 2015 -- Informa Exhibitions said that the second annual International Surface Event East 2015 dates have shifted to Nov. 2-5 and the location is moving to Orlando, Florida at the Orange County Convention Center.

Shaw Introduces New Carpet Backing, Protection System   Full Article
Dalton, GA, Jan. 19, 2015 -- Shaw Floors said it is introducing LifeGuard, a new carpet protection system that covers the entire product, from face fiber to backing.

Valinge, System SpA Form Printer Partnership   Full Article
Viken, Sweden, Jan. 19, 2015 -- Välinge Innovation and System SpA have entered into a strategic partnership to supply the flooring and building panel industry with industrial single-pass printers .

Surfaces Show Featuring Booth Crawl Challenge   Full Article
Dallas, TX, Jan. 19, 2015 -- This week's Surfaces show will feature a Booth Crawl Challenge, a new show promotion.

Ceramics of Italy Contest Deadline Extended   Full Article
Bologna, Italy, Jan. 19, 2015 -- The submission deadline for the 2015 Ceramics of Italy Tile Competition has been extended to Jan. 23.

Polley To Be Inducted into WFCA Hall of Fame   Full Article
Anaheim, CA, Jan. 19, 2015 -- David Polley is the newest inductee to the World Floor Covering Association Hall of Fame.

HPS Schönox To Name Contest Winners on Thursday   Full Article
Las Vegas, NV, Jan. 16, 2015 -- HPS Schönox will present the winner of its Schönox Worst Subfloor in North America Contest at Surfaces next Thursday at 11 a.m..

Shnier To Distribute Metroflor's Aspecta in Canada   Full Article
Norwalk, CT, Jan. 16, 2015 -- Metroflor Corp. said it has formed a partnership with Shnier, a leading Canadian floor covering company, to distribute its commercial Aspecta LVT.

Dealer Discovers Rug Owned by FDR   Full Article
New York, NY, Jan. 16, 2015 -- John Ahdoot of Ahdoot Oriental Rugs recently discovered a rug in a New Jersey couple’s home that once belonged to Franklin Delano Roosevelt.

Consumer Sentiment at 11-Year High   Full Article
Ann Arbor, MI, Jan. 16-2015 -- Consumer sentiment in January surged to the highest level in 11 years, according to the preliminary reading of the University of Michigan/Thomson Reuters consumer sentiment index.

Consumer Prices Fall Most in Six Years   Full Article
Washington, DC, Jan. 16, 2015 -- U.S. consumer prices fell 0.4% in December, the largest drop since the end of 2008, according to the Labor Department.

Pharr Yarns Invests in New Space Dye Technology   Full Article
McAdenville, NC, Janu. 15, 2015 -- Pharr Yarns said it has invested in space dye technology for its McAdenville facility to handle the growing demand for sophisticated design.

Engineered Floors Using Dye, Stain Technologies in Soft Nylon   Full Article
Dalton, Ga., Jan. 16, 2015 – Dream Weaver Carpet and Engineered Floors say they are using technology they developed for coloring polyester fiber and applying it to soft nylon.

IVC Deal a Good Sales Opportunity for Mohawk   Full Article
New York, NY, Jan. 15, 2015 -- Stifel Nicolaus still has a "buy" rating on shares of Mohawk Industries following Mohawk's announced acquisition of vinyl firm IVC for $1.2 billion.

Producer Prices Decline in December   Full Article
Washington, DC, Jan. 15, 2015 –- Producer prices fell by 0.3% in December, according to the Commerce Department.