Q4 2015 CRE Trends Apartment Office Retail Industrial Markets

Q4 2015 CRE Trends Apartment Office Retail Industrial Markets

Updated quarterly market reports for all CRE sectors.

Apartment Trends

green-bulletNational asking rent growth clocked in at 4.6% for all of 2015, while effective rent growth mustered an impressive 4.7%.
green-bulletThe national vacancy rate for the end of 2015 stood at 4.4%, an increase of 10 basis points over the prior quarter.
green-bulletDuring the fourth quarter, the difference between new construction and net absorption grew to around 14,800 units.

Office Trends

green-bulletNational office vacancies declined by 20 basis points in the fourth quarter, falling to 16.3%.
green-bulletBy several measures — including net absorption, new construction, and vacancy compression — 2015 was the best year for the office market in recent history.
green-bullet67 out of 82 markets posted increases in effective rents in Q4.

Retail Trends

green-bulletThe national vacancy rate declined by 10 basis points to 10.0% during the fourth quarter.
green-bulletThis was the first decline since the first quarter of 2015 and intimates that the market is regaining some momentum.
green-bulletNew completions for neighborhood and community center space was stuck at a low level during the fourth quarter with just 2,121,000 square feet of space constructed.

Industrial Trends

green-bulletFor the second quarter in a row, the Flex/R&D market outpaced the Warehouse/Distribution market in terms of demand growth, rent growth for both increased at similar rates.
green-bulletWarehouse/distribution net absorption totaled 22.5 million SF in Q4, down slightly from the previous quarter’s 27.1 million SF.
green-bulletFlex/R&D net absorption jumped to 4.4 million SF from a steady average of 3.5 million in the last three-quarters.

New Construction Trends

green-bulletFor the first time in over a year, construction across all three major property types increased in a given quarter during the fourth quarter.
green-bulletApartment continues to lead the way, registering the third consecutive quarter above 50,000 units.
green-bulletRetail, though the laggard, is also showing signs of improvement with construction increasing for the third consecutive quarter


Source: REIS 2016



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