January 12, 2016
Reis Inc. 4Q15 retail and office reports show signs of improvement, as GDP growth and labor market recovery continue.
Retail ended 4Q15 in decent shape, according to recent reports released by Reis Inc. The vacancy rate stood at 10.0%, a 10 basis-point (bps) decline from 3Q15’s 10.1%. Annual effective rent growth was 2.2%. Though retail’s recovery has been volatile since the Great Recession, Reis’ Senior Economist and Research Director Ryan Severino believes the sector will experience slow, but definite improvement, in 2016.
There was also good news in the office sector during 4Q, as the national vacancy rate was 16.3%, a 20-basis-point drop from 3Q15. Reis’ 4Q15 office report noted that the vacancy rate has declined in five of the last six quarters, and was at its lowest level since 2009. Annual effective rent growth was 3.2%. The Reis 2016 forecast calls for the vacancy rate to fall 40 bps, with rent growth at 3.8%, thanks to continued GDP growth and labor market recovery.