Report: Commercial real estate markets begin long, slow recovery
Princeton, N.J. -- A report released Tuesday by NAI Global said that real estate conditions worldwide had stabilized and were beginning to improve.
According to NAI Global’s 25th annual Global Market Report, after a prolonged, challenging period marked by frozen credit, sidelined investors, stalled development, rising vacancy rates and declining rental rates and property values, modest improvement is expected in just about every market sector and geography in 2011.
“Although 2010 was another very challenging year for the industry, we began to see clear signs that the global economy and commercial real estate markets had stabilized and were beginning to improve with a noticeable pickup in transaction volume around the world,” said Jeffrey M. Finn, NAI Global president and CEO.
“Companies around the globe are taking advantage of the current market, extending or renegotiating leases, securing investment properties, disposing of underperforming assets and finalizing plans for growth in the next 24 months. We expect a much more active market for buyers, sellers and occupiers as conditions continue to improve,” he said.
With regard to retail specifically, the report said that the nation’s retail markets appear to have stabilized. While some markets still struggle to fill big boxes vacated by national chains, others have seen new entries and local retailers upgrading to better locations, according to the report. The national average vacancy rate for downtown/CBD retail space stood at 8.2% in 2010, down from 8.9% in 2009, while rents slipped from $39.90 in 2009 to $39.79 in 2010.