We use cookies to provide you with a better experience. By continuing to browse the site you are agreeing to our use of cookies in accordance with our Cookie Policy.
  • ::COVID-19 COVERAGE::
  • INDUSTRY PRESS ROOM
  • ABOUT
  • CONTACT
  • MEDIA FILE
  • Create Account
  • Sign In
  • Sign Out
  • My Account
Free Newsletters
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC.
    • Podcast
    • Blogs
      • Analytics & Big Data
      • Best Practices
      • Dispatches
      • Empowering Your Performance Edge
      • Logistics Problem Solving
      • One-Off Sound Off
      • Public Sector Logistics
      • Two Sides of the Logistics Coin
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • MODEX 2020
    • Upload Your Video
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC.
    • Podcast
    • Blogs
      • Analytics & Big Data
      • Best Practices
      • Dispatches
      • Empowering Your Performance Edge
      • Logistics Problem Solving
      • One-Off Sound Off
      • Public Sector Logistics
      • Two Sides of the Logistics Coin
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • MODEX 2020
    • Upload Your Video
Home » Higher interest rates shouldn't sidetrack strong commercial property market, CBRE says
newsworthy

Higher interest rates shouldn't sidetrack strong commercial property market, CBRE says

January 13, 2016
DC Velocity Staff
No Comments

The Federal Reserve's recent decision to raise interest rates should not slow capital flows into the thriving U.S. commercial property market—which includes warehouses and distribution centers—because solid economic fundamentals will prop up asset values and foreign demand for U.S. property will remain strong, said real estate giant CBRE Group Inc. in releasing its fourth-quarter analysis of the commercial sector.

The fourth-quarter "industrial availability" rate, which CBRE defines as the percentage of properties being marketed and available within a 12-month period for a tenant to make any interior modifications, hit 9.4 percent in the fourth quarter, the Los Angeles-based firm said Monday. This marks the 23rd consecutive quarter of failing availability in the industrial sector, the longest stretch since CBRE began tracking the national market in 1989, the company said.

Of 57 industrial markets that CBRE monitors, 35 reported declining availability in the fourth quarter, CBRE said. Detroit reported the most significant drop, with the availability rate falling 120 basis points, or more than one full percentage point, from the third quarter, CBRE said. Dallas, New York, and Atlanta also reported significant sequential declines, it said.

"The majority of markets continue to improve, and a few are even experiencing lower levels of available space than has been seen in decades," said Jeffrey Havsy, Americas chief economist for CBRE. "Such constraints will continue to provide upward pressure on rent levels, as demand-side fundamentals remain quite favorable for industrial users."

Besides the industrial sector, CBRE tracks the office, retail, and apartment sectors. Those sectors also performed well in the fourth quarter, the company said. CBRE has not issued its 2016 outlook for the overall market.

In mid-December, the Fed raised its key federal funds rate—the rate banks and credit unions charge each other for overnight loans—from a range of 0 to 0.25 percent to a range of 0.25 to 0.5 percent. It was the first interest-rate hike in nearly a decade.

Yet the marginally higher borrowing costs will not sidetrack an industry that is demonstrating steadily improving fundamentals, according to Havsy. "Commercial real estate remains in a 'Goldilocks' state, with both demand and supply neither too hot nor too cold," Havsy said in a statement. "This slow, stable improvement is extremely healthy for the sector, but is at a pace that is sustainable for 2016."

Logistics Network Design
KEYWORDS CBRE SeaIntel
  • Related Articles

    Industrial property market finishes strong to punctuate solid year, JLL report says

    U.S. industrial property demand to stay strong in '17, CBRE forecasts

    North American industrial property market to see strong growth through 2017, report says

Recent Articles by DC Velocity Staff

CMA/CGM to add LNG-powered ships to U.S. service

Buyers could target warehousing and fulfillment operations in 2021, investment bank says

North American entries rank high in Toyota Material Handling design contest

You must login or register in order to post a comment.

Report Abusive Comment

Most Popular Articles

  • Relaxed regulations for drone parcel delivery to take effect in March

  • Gartner survey signals increased investment in resilience over the next two years

  • Increasing Urgency for Vaccine Supplies Drives Launch of New Vaccine Manufacturing Resources on Thomasnet.com

  • IBM survey says digitalization trends will sweep trucking industry by 2030

  • What Level of Automation is Right for Your Warehouse?

Now Playing on DCV-TV

Ef7899d1 1c83 487b 9291 8af692931c96

myQ Dock Management

DCV-TV 4: Viewer Contributed
Introducing myQ Dock Management. Connect your loading dock equipment and iDock Controls from Poweramp, McGuire, or DLM to the cloud and view your loading activity online with myQ Dock Management.Facilities with myQ can monitor the real-time status of their docks and be proactive in improving efficiency and safety. ...

FEATURED WHITE PAPERS

  • Time to rethink your lift truck power

  • Warehouse Management System Project Toolkit

  • Solving Talent Management Challenges Now and In the Future

  • Shaping Up Last Mile Delivery to Surpass Customer Expectations

View More

Subscribe to DC Velocity Magazine

GET YOUR FREE SUBSCRIPTION
  • SUBSCRIBE
  • NEWSLETTERS
  • ADVERTISING
  • CUSTOMER CARE
  • CONTACT
  • ABOUT
  • STAFF
  • PRIVACY POLICY

Copyright ©2021. All Rights ReservedDesign, CMS, Hosting & Web Development :: ePublishing