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Setting Apartments Up For a Fall

Tepid. Anemic. Lethargic. Slower than we’d like.That was the commercial real estate market story for 2011, and it looks like more of the same for the New Year as well as the foreseeable future. Vacancy rates will get better, but remain uncomfortably above equilibrium. Rents won’t increase substantially, and deal making will be relatively subdued even in the top markets.

By Jonathan D. Miller | Updated on January 03, 2012

 Tepid. Anemic. Lethargic. Slower than we’d like.

That was the commercial real estate market story for 2011, and it looks like more of the same for the New Year as well as the foreseeable future. Vacancy rates will get better, but remain uncomfortably above equilibrium. Rents won’t increase substantially, and deal making will be relatively subdued even in the top markets. From a risk perspective, this shaky forecast also will remain particularly vulnerable to bolts out of the blue—now wouldn’t it be great if the Straits of Hormuz were blocked? And can anybody feel confident about what’s going on in Europe? The tap dance continues there.

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