Commercial Outlook: Leasing Projections

By
Real Estate Agent with The Kim Group ~ Commercial Real Estate Team for Peoria, IL

Investment prices are lowest in the mid-west compared to other markets nationally.  In the midwest, sublease space is closer to normal than SIORs in other parts of the country. So we are not going to see the huge decreases in rent that will be seen on the national level.  We will see rent prices remain the same or decrease in order to stay competitive with vacant property that has been on the market longer. If you have had your property on the market for 6 months to a year, you will want to contact us and discuss where you property should be priced at in order to move in the current market.

Please note the table below shows the projections on a national level.

Property Type Q3 Vacancy 2009 Net Absorption (in sf) 2009 Rent Growth
Office 16.70%  -77.4 million -4.20%
Industrial 12.20%  -148.1 millions -4.10%
Retail 13.40%  -49.8 million -9.00%
Multifamily 6.00% 127,500 1.70%

Investors are showing concern for market sectors that are dependent on consumer and corporate spending, ie. shopping malls, warehouses, office buildings and the one highest on their list, hotels.  Companies involved in health-care facilities or senior housing are thought to be somewhat protected.  

Listings in Central Illinois Area as of 6/22/2009:

  • Industrial  -          271 active listings         (38 in city of Peoria)
  • Office -                680 active listings         (133 in city of Peoria)
  • Retail -                512 active listings         (79 in city of Peoria)
  • Multi-Family -       51 active listings           (2 in city of Peoria)

 

 Source: NAR Commercial Real Estate Outlook, February 2009

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