“While the economic recovery remains choppy, with numerous headwinds and setbacks, the trends for commercial real estate nonetheless remain positive,” Nadji tells GlobeSt.com. “Absorption for all major commercial property types continues to build, with each property type generating positive rent growth. Apartments have led the way, with many markets surpassing their pre-recession peaks in both occupancy and rents, but industrial, retail and office properties continue to gain momentum.”

Nadji adds that recent gains in industrial production reiterate broader positive economic trends, and though growth will undoubtedly face headwinds resonating from Europe and other trouble spots, the industrial sector will continue to fuel gains across the economy. “The strengthened industrial base continues to add jobs, with manufacturing hires totaling 227,000 positions over the last 12 months. These hires, together with the broader impacts offered by a strengthened industrial base, will naturally ripple throughout the economy.” Still, he says, with the Eurozone facing austerity, high unemployment and hovering near recession, exports could weaken in coming months.

According to M&M’s recently released market overviews, an uneven recovery is expected this year for various California retail markets. Los Angeles County employers will add 40,000 individuals to retail payrolls this year, amounting to only a 1% increase. (Still, last year job growth was 0.8%, with 29,000 new hires.) After the addition of just 300 retail workers in 2011, East Bay employers will expand total employment by 25,000 individuals, or 2.6%, a recorded growth the magnitude of which the metro area has not seen since before the recession. And in Orange County, retail employment will grow by 30,500 positions in 2012, amounting to a 2.2 % annual gain. Strong performance in the trade, transportation and utilities sector, as well as the professional and business services sector, is expected to lead the expansion in this market. To compare, last year employment advanced 1.8% in Orange County with 24,400 new hires.

Given the encouraging data, Nadji tells GlobeSt.com that he retail sector continues to face challenges, but the worst is clearly behind us. “Retail sales have exceeded pre-recession levels by a wide margin, and while much of the gains have been at opposite ends of the consumer spectrum—luxury and discount retail—the gains have gone a long way toward stabilizing the performance of retailers. Several notable retailers such as Best Buy and Bon Ton continue to face challenges as they reinvent their business models, but many including Costco, Nordstrom and Whole Foods have announced quite strong sales reports. The retail sector still has a ways to go, and most retailers remain cautious, but the performance trends are moving in the right direction.”

For the complete Research Brief blog, click here.