Despite an increase in construction activity in multiple markets, aggregate demand continues to outstrip supply across all major property types, a new report from the CoStar Group says. The result is lower vacancy rates and rent growth that continues to attract strong investor interest in commercial real estate, including Philly office space and Philly retail space, according to the newest CoStar Commercial Repeat Sale Indices (CCRSI).
The value-weighted U.S. Composite Index and the equal-weighted U.S. Composite Index rose by 1.3% and 1%, respectively, in August 2015, and by 12.6% and 11.4%, respectively, for the year ended August 2015, the report said. The indices are the two broadest measures of aggregate pricing for commercial properties within the CCRSI.
The General Commercial segment, which is affected by smaller, lower-value properties, experienced recent more robust growth, corroborating a broad-based pricing recovery, CoStar reported. Within the equal-weighted U.S. Composite Index, the General Commercial segment saw a monthly increase of 1% for August 2015 and 11.9% for the year ended August 2015, driving the index to within 7% of its pre-recession high.
Net absorption across the office, retail and industrial segments — the three major property types — reached 611.4 million square feet for the year ended in the third quarter 2015. That level was 20% more than in the prior year ending in the third quarter 2014 and stood as the second-highest annualized absorption total since 2008, according to CoStar.
Especially strong showings were seen in the office and industrial segments during the four quarters ending in the third quarter 2015, with net absorption averages at of 0.3% of inventory for the office sector and 0.4% for the industrial sector. Gains in the retail sector were more modest at 0.2% over the same time period, the report noted.
The CCRSI’s U.S. composite pair volume of $79.5 billion year-to-date through August 2015 saw a 32% jump in comparison with the same time period a year earlier, CoStar said.
With volume up by almost 32% in the Investment-Grade and General Commercial sectors, increased capital flows are being seen in both the high and low ends of the market, according to the report.
For more information about Philadelphia office space, Philadelphia retail space or other Philadelphia commercial properties, please call 215-799-6900 to speak to Jason Wolf (215-588-8800-cell; jason.wolf@wolfcre.com), Leor Hemo (215-514-1750-cell; leor.hemo@wolfcre.com) or Lee Fein (215-206-5580-cell; lee.fein@wolfcre.com) at Wolf Commercial Real Estate, a premier Philadelphia commercial real estate brokerage firm that specializes in Philly office space and Philly retail space.
Wolf Commercial Real Estate is a Philadelphia commercial real estate broker that provides a full range of Philadelphia commercial real estate listings and services, marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.
Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philadelphia office space or Philadelphia retail space with the Philadelphia commercial properties that best meets their needs. As experts in Philadelphia commercial real estate listings, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia office space, Philadelphia retail space and other Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals. If you are looking for Philly office space or Philly retail space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.
Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.
