U.S. commercial real estate market to improve in 2011

The U.S. economy is poised for major acceleration in employment growth, with 3.2 million jobs projected to be added in the next 12 months, according to Cushman & Wakefield’s Economic Pulse regional reports, which provide a 2011 outlook for commercial real estate in the Americas, Europe and Asia Pacific. The projected acceleration in job growth in the U.S. will have major implications for all major sectors of the commercial real estate market, with office, industrial, retail and multi-family markets to benefit. In central business districts, the vacancy rate reached a peak of 15 percent in the first quarter of 2010 and declined moderately in the subsequent three quarters, ending the year at 14.4 percent, and an additional 660,000 jobs in this sector will cause vacancy to drop sharply in 2011. In an environment of economic growth and declining vacancy rates, it is likely that rents will stabilize in 2011 and may begin to rise, particularly in markets that are tighter than the national average, the report says. Overall, 2011 is likely to mark a turning point for rents in the U.S. commercial real estate market, the report says.

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