Craig Trbovich Commercial Real Estate –
Halfway through 2014 and the Phoenix Commercial Real Estate market continues to recover with hot spots and new development around the Valley. Even though hot is not our favorite thought this time of year in Phoenix, real estate hot is welcome 365 days a year!
And our nation’s economy could certainly use a little hot sauce. The recovery continues, but not without concerns in a few key areas while other areas show promise:
US Unemployment Rate
6.1%. Gradually declining and the lowest since September 2008. 288,000 jobs added in May, a solid month for new jobs but not yet a hot jobs market.
Gross Domestic Product
2.9% decrease in the first quarter (down 2.9%). What will Q2 and the rest of 2014 hold?
17,000 – a new record close and the first over 17,000 recently. There have been 12 record closings for the Dow this year.
Recovery has occurred, but overall, the housing market has stalled and expansion has been slow. Until the jobs market heats up, the housing market will stay cool.
Inflation and Interest Rates
Both expected to start inching upward over the next 2-3 years as the economy continues its recovery.
World’s Biggest Oil Producer
What the frack? Who knew the United States is about to claim that title?
2014 Mid-Year Phoenix Leasing Statistics
Here are the first half of 2014 Phoenix Metro leasing statistics with Hot Spots in each sector with comparisons in the last column of the last market’s peak.
Phoenix Industrial Warehouse
HOT SPOTS – The Southwest Market with nearly 4 million square of gross absorption in the first half of 2014. And the Deer Valley Market with only a 7.4% vacancy rate, even with 500,000 square feet of new space in 5 new developments added to the availability.
HOT SPOTS – Tempe vacancy rate at 9.8%. Future hot sector – medical, valley wide, especially near hospitals.
HOT SPOTS – Phoenix Metro. Many Phoenix submarkets have vacancy rates under 8% as consumer spending continues to push retail sales higher.
Later this month, I’ll take a closer look at investment sales for the first half of 2014 and discuss emerging trends. For a no obligation analysis of your property, please call me at (408) 522-2799 to “TrboCharge” your investment real estate today.