The commercial real estate marketplace in the United States will continue on its path to recovery next year with modest gains in leasing, pricing and rents, according to the new Emerging Trends in Real Estate Forecast for 2013 report from the Urban Land Institute and PwC US, which was presented on 17th of October during a webcast delivered from the ULI's annual conference in Denver. The report expressed opinions derived from more than 900 surveys of and interviews with commercial real estate leaders.
Survey participants believe that while the real estate recovery is happening more slowly than normal, the prospects for all sectors of the property market are much better in 2013 than they were this year. "Recent job creation should be enough to increase absorption and push down the vacancy rates in the office, industrial and retail sectors, helped by the limited new supply in commercial markets," the report says.
High demand for apartments is anticipated to continue next year even as new projects start to come online, with even the single-family home sector doing a lot better in the great majority of regions. The only real issues in the housing market are in the second home and leisure markets.
"With the outlook for commercial real estate continuing to improve in 2013, investors are expected to allocate substantial sums of capital to the real estate asset class, according to our survey respondents," says Mitchell Roschelle, a partner at PwC, the real estate advisory practice leader in the United States. Roschelle adds that as yields on bonds and various other financial instruments continue to tighten in a still very volatile market, commercial real estate's total return and income producing attributes are offering investors potentially very attractive risk adjusted returns.