Each Wednesday, The Wrap presents a compilation of recent noteworthy commercial real estate stories from a variety of publications. Below are links to five stories that caught our eyes in recent days.
• Demand for Office Space Ramps Up by Eliot Brown of the Wall Street Journal.
“Employers added 15.3 million square feet of office space in the fourth quarter, more than any other quarter since the third quarter of 2007, according to real-estate research service Reis Inc. That pushed the vacancy rate down to 16.3 percent, while rents sought by landlords hit $30.86 a square foot, up from $29.94 a year earlier, according to Reis. For all of 2015, employers occupied an additional 42.4 million square feet. That is up from 31.4 million square feet [in 2014].”
• MPF: 2015 Marks Sixth Straight Year of Higher Than Normal Rent Increases by Brian Croce of Multifamily Executive.
“Since there is now a backlog of units in the pipeline, MPF Research states that 2016 could be a huge year for deliveries, as there are currently more than 440,000 units under construction, more than 310,000 of which are targeted for completion this year. If that’s the case, it could top 2015’s total by as much as 34 percent.”
• Spotlight on Office by National Real Estate Investor.
“Atlanta’s office vacancy rate has dropped by more than 4 percent over the last four years in all categories—class-A, class-B and class-C, while effective rental rates have increased by more than $2.20 per sq. ft. over the past three years, notes [Thomas F.] Davenport. The office sector has benefited from the overall economic rebound, as well as notable corporation headquarter relocations to the city by companies including Mercedes Benz North America and Pulte Homes. Yet that recovery still varies widely across the metro with some submarkets, such as Buckhead, exhibiting strong rent growth, while others have seen minimal or no rent growth, Davenport adds.”
• What’s Especially Unique About Southeast CRE by Jennifer LeClaire of Globe St.
“‘Atlanta is in an enviable economic position as 2016 begins, one that will ultimately lead to stronger commercial real estate conditions and provide the foundation for new development activity,’ Dan Wagner, a regional research manager at CBRE, tells GlobeSt.com. ‘The region’s lower overall costs, such as housing, real estate occupancy, wages and taxes, is resulting in robust in-migration at both the corporate and individual levels.’”
“Although CMBS production in early 2015 outpaced 2014 production, it has gone down in the fourth quarter. However, Parrett remains optimistic, saying that CMBS will likely end the year slightly above 2014’s production levels. ‘2016 should bring refreshed enthusiasm to the debt markets,’ he said. Real estate fundamentals are steadily improving and Parrett said most life company lenders have 2016 allocations that are equal to or greater than their allocations in 2015.”