Although the private sector individual housing sales are slow, U.S. Commercial Real Estate is seeing an improved market. Multifamily housing is seeing rent increases according to the most recent marketing survey. A major contributing factor is the improved job market and the resultant commercial vacancy rate. The reduction in vacancies is due to increased leasing of commercial space.
Experts predict a decline in vacancies across the board. Office space is expected to decrease by 4 percent, industrial space 8 percent, retail 9 percent and 2 percent in multifamily apartments. The decline in vacancies is expected to encourage new construction. The alternative is further rent increases.
Vacancy rates in Orange County California are 4.8 percent. Those in Los Angeles are 4.9 percent. In Miami they are 7.6 percent. These are the areas that have the lowest vacancy rates in the industrial sector. Industrial rent is predicted to rise 1.8 percent in 2012.
The vacancy rates in retail rentals are 3.6 percent in San Francisco, 5.1 percent in Fairfield County, Connecticut and 5.4 percent in Long Island, New York. A further decline in retail vacancies is expected to reach 11.9 percent in the current quarter. Rent is expected to rise 7 percent in 2012.
Multifamily rentals with vacancy rates lower than 5 percent are regarded as justification for landlords to increase the amount of rent per unit. These amounts are predicted to rise by 3.8 percent in 2012 and 4 percent in 2013. Lowest vacancy rates for apartments are in New York City, Minneapolis, Portland, Oregon and San Jose, California. Overall, the U.S. Commercial Real Estate market is seeing general improvement.