Strengthening demand from smaller markets will help the commercial sector see stable growth and offer “decent” returns for investors in 2017, according to the National Association of REALTORS®’ quarterly commercial real estate forecast.
NAR predicts that the national office vacancy rate will drop 1.1 percentage points to 12.1 percent this year. Job growth in the business and professional services sector is expected to increase the need for office space in 2017. The apartment sector is expected to remain the top performer.
Further, the vacancy rate in the industrial space is predicted to drop 1.3 percentage points to 7.1 percent, while retail space availability will likely drop slightly by 0.7 percentage points to 11.2 percent. The multifamily sector will likely have little change to its vacancy rate over the next year as apartment completions stay at 6.5 percent, NAR reports.
Source: National Association of REALTORS®