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National Report: Rents Rising Rapidly

SAN FRANCISCO-Rents are up for all sectors in all regions of the US, according to a new report. On a market-by-market basis, there were many winners and one clear loser.

By Brian K. Miller | Updated on November 19, 2006

SAN FRANCISCO-Global Real Analytics third quarter report on rents shows some of the fastest growing rents since the beginning of the decade. All sectors showed strong rent growth nationally and all but retail, which is flattening out after being the best performer in recent years, showed significant increase from the prior quarter.

The most dramatic rise by sector occurred in CBD office. The sector’s third quarter results equate to an annual increase of 6.7%, well above the 2.7% annual growth rate it posted in the third quarter of 2005. The class A apartment market also saw rents rise at a 6.7% annual clip during the third quarter, and all sectors saw rents during the quarter grow at least a 5.2% annual clip.

On the down side, the national results belie “a fairly marked disparity in performance across regions,” GRA’s managing director of global forecasting and research Dan O’Connor tells GlobeSt.com. “Looking back 12 months in the good regions, rental rate growth has been between 7% and 9%. In the weak regions, it has been more on the order of 2% to 4%, effectively half.”

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