IRR 2015 CRE Outlook

Integra Realty Resources (IRR), the largest independent market research and commercial real estate valuation and counseling firm in North America, has released its Viewpoint 2015 report, which reveals projections for commercial real estate in 2015 across all property types. In total, IRR expects real estate values to appreciate across all markets, with improved property fundamentals continuing to drive positive yields and attract additional capital to the sector.

"With our independent position in the marketplace, in IRR Viewpoint we have been able to create an incisive and unbiased report that the industry relies on year after year as a primary resource for research and analysis of the commercial real estate industry in the United States," said John Albrecht, CEO of Integra Realty Resources. "This past year we also completed the largest technology investment that IRR has ever made, giving us even more advanced capabilities to research local and national markets and provide our clients with the benefits of our industry-leading expertise on commercial real estate assets."

Key findings of IRR Viewpoint 2015 for the office market include:

• The office property sector continued its relatively steady recovery in 2014, though the sector lags behind other property sectors in the latest national recovery cycle. More local office markets -- both Central Business District (CBD) and Suburban -- are now mired in the recessionary phase and many more are just beginning a recovery.
• After decades of suburban corporate campus building, a key national trend is the return to new CBD construction, as today's younger workforce wants tech-driven office spaces in populous areas. While developers and investors seemingly prefer the CBD office property sector, property fundamentals for the Suburban office sector strengthened just as much as those in the CBD sector nationally in 2014.
• Recent changes in stabilization expectations reversed the trend from the previous few years and now indicate that the Suburban office sector nationally is more likely to stabilize before the CBD sector, albeit at materially lower rental rates and marginally lower occupancy rates.
• 2014 was another robust year for transaction volumes, with most cities experiencing strong volume increases over five-year historical averages. Activity was notably strong in Cincinnati, Boston, Jacksonville, San Francisco, and Philadelphia; transaction volumes were down only in a handful of cities, including Pittsburgh, Seattle, Cleveland, Hartford, and Richmond.

A free download of the report is available here. For more news and information visit Blumberg Capital Partners.