Small Steps Toward a Recovery

Small Steps Toward a Recovery

By: Nicholas A. Dunlap, CPM

Success in commercial real estate depends on jobs. From employment growth to wage growth, investors make their decisions based highly on the performance of a region or the projections set for a specific time period. Right now, the statistics bode well for office and multifamily properties alike. People have jobs and need a place to live. Employers now hiring, need a place for their employees to work. This improving climate has highlighted several market areas as “places to watch”.

Recent data released by the Labor Department shows that unemployment has decreased to 8.8% which happens to be a two year low. Of course there are specific geographic regions where the number may be higher or lower, but the general idea that things are looking up is recognized nationwide. Be it from an operational standpoint where we recognize an increase in rental applications and occupancy or a decrease in delinquencies, or from the investment standpoint where we are actively considering new opportunities, we are heading toward a perfect storm for positive cash flow real estate investors: low interest rates, decreasing unemployment and product available at a discount from recent highs.

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