This was two years ago. http://www.nytimes.com/2008/12/17/business/17distress.html Now a New York research company, Real Capital Analytics, has compiled data showing that at least $107 billion worth of income-producing property — including hotels, offices, apartment complexes and warehouses — is already in distress or is headed in that direction. Now we have this. ... [more]
This was two years ago.
http://www.nytimes.com/2008/12/17/business/17distress.html
Now a New York research company, Real Capital Analytics, has compiled data showing that at least $107 billion worth of income-producing property — including hotels, offices, apartment complexes and warehouses — is already in distress or is headed in that direction.
Now we have this.
http://www.crainsnewyork.com/article/20110111/REAL_ESTATE/110119967
The Manhattan commercial real estate market rebounded sharply last year, with both leasing activity and sales transactions soaring as the city’s economic recovery outshone the rest of the nation’s, according to Cushman & Wakefield Inc.
Leasing activity surged 61% last year to 26.3 million square feet from 16.3 million square feet in 2009. In the fourth quarter, activity totaled 7.5 million square feet, the second-highest total in five years and the highest since the third quarter of 2006.
“We see this demand continuing,” said Joseph Harbert, chief operating officer for Cushman & Wakefield’s New York metro region. “We expect this velocity to continue.”
What do you all think? Has the commercial market made a comeback?
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Response by falcogold1
over 15 years ago
Posts: 4159
Member since: Sep 2008
I sure hope so.
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Response by newaccount
over 15 years ago
Posts: 332
Member since: Jun 2008
Commercial needs to pick up in order for residential to sustain growth. All this inventory without the demand (jobs) will further depress values.
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Response by rb345
over 15 years ago
Posts: 1273
Member since: Jun 2009
The recovery trajectory of the commercial real estate market will not parallel that of
residential real estate because commercial is subject to a number of factors that are
reducing demand that don't affect residential, including:
a. corporare space down-sizing: many companies renewing lease are reducing ft/employee
by 25-50%
b. telecommuting, which is reducing need for a centrally-located space
c. mutli-shifting space use, where space is assigned to 2 or more users
d. out-sourced centralization of print function, which is reducing print-space needs
e. digitalization and "cloud" storage of business files formerly stored in offices
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Response by malthus
over 15 years ago
Posts: 1333
Member since: Feb 2009
It also includes hotels, which by their short term nature, recover faster than any other category.
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Response by steveF
over 15 years ago
Posts: 2319
Member since: Mar 2008
Thax for the comparison yogurt. Ciy economy is plowing(no pun) ahead.
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Response by aboutready
over 15 years ago
Posts: 16354
Member since: Oct 2007
more important than leasing activity levels is total square footage leased (and total available). many tenants have been in long-term leases that they would love to leave for cheaper space. as their leases are up they'll move on. and many of them will receive amazing concessions from their new landlords to do so. musical chairs isn't necessarily a sign of strength, it's a sign of businesses taking advantage of good deals, and leaving their old tired more expensive spaces empty.
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Response by truthskr10
over 15 years ago
Posts: 4088
Member since: Jul 2009
Well your comparing an article about all of commercial properties with an article 2 years later that is specific to offices only.
And unfortunately what statistics don't show is the amount of renegotiated leases over the last 2 years.
A tenant with 3,5, 8 years left on their lease going to landlord and saying I cant afford the rent anymore.
If I stay I need XX% off or I have to move. Landlord response; Your obligated to the lease.
Tenant response;If this goes to court I will likely end up in bankruptcy.
Landlord then does the math and has to decide, do I bite the bullet and have a continuing tenant or do I go the other route, spend money on lawyers for possibly no fruit, stay empty for 3,6 months or longer which will ammortize to the same or more XX% off my current income.
THough these transaction undoubtedly weigh on the numbers, the full weight can't be reflected in the stats as these inventories and these prospective renters were never offically in the market place.
I sure hope so.
Commercial needs to pick up in order for residential to sustain growth. All this inventory without the demand (jobs) will further depress values.
The recovery trajectory of the commercial real estate market will not parallel that of
residential real estate because commercial is subject to a number of factors that are
reducing demand that don't affect residential, including:
a. corporare space down-sizing: many companies renewing lease are reducing ft/employee
by 25-50%
b. telecommuting, which is reducing need for a centrally-located space
c. mutli-shifting space use, where space is assigned to 2 or more users
d. out-sourced centralization of print function, which is reducing print-space needs
e. digitalization and "cloud" storage of business files formerly stored in offices
It also includes hotels, which by their short term nature, recover faster than any other category.
Thax for the comparison yogurt. Ciy economy is plowing(no pun) ahead.
more important than leasing activity levels is total square footage leased (and total available). many tenants have been in long-term leases that they would love to leave for cheaper space. as their leases are up they'll move on. and many of them will receive amazing concessions from their new landlords to do so. musical chairs isn't necessarily a sign of strength, it's a sign of businesses taking advantage of good deals, and leaving their old tired more expensive spaces empty.
Well your comparing an article about all of commercial properties with an article 2 years later that is specific to offices only.
And unfortunately what statistics don't show is the amount of renegotiated leases over the last 2 years.
A tenant with 3,5, 8 years left on their lease going to landlord and saying I cant afford the rent anymore.
If I stay I need XX% off or I have to move. Landlord response; Your obligated to the lease.
Tenant response;If this goes to court I will likely end up in bankruptcy.
Landlord then does the math and has to decide, do I bite the bullet and have a continuing tenant or do I go the other route, spend money on lawyers for possibly no fruit, stay empty for 3,6 months or longer which will ammortize to the same or more XX% off my current income.
THough these transaction undoubtedly weigh on the numbers, the full weight can't be reflected in the stats as these inventories and these prospective renters were never offically in the market place.