Market Data

Market Trends

Millennials Moving the Needle on Retail

  • Millennials make 54% of their purchases online, up from 51% in 2015 and 5% higher than online purchases by other generations.
  • Millennials don't view the world through channels. Smartphones, tablets, social media, stores, and everything else are all one big ecosystem.
  • To survive, retailers must integrate their thinking, systems, and ways of doing business.
  • Digital natives are either a force to contend with - or to succeed with.

Source: Cushman & Wakefield


Grocers Beware: Disruption Is on the Horizon

“Shoppers in the coming years will think nothing of using voice-activated devices like Amazon's Echo to restock their kitchens. They'll habitually cook meals with ingredients delivered by the likes of Blue Apron, or drive to kiosks outside of their neighborhood store to pick up groceries after work. We're already seeing this kind of channel fragmentation and disintermediation across the industry, and it will only accelerate.”


-Joe McKeska, president of Elkhorn Real Estate Partners


Briefly Noted

Hospitality — While U.S. hotel occupancy reached a new record level during 2016, reflecting its continued rigor, growth is becoming more uncertain in major markets. Houston, Miami, and New York City have experienced negative growth for hospitality. In 2017 so far, the strongest performers have been secondary markets along the west coast and Washington, D.C., according to JLL.

Industrial — With sales growing at a 13 percent clip, e-commerce continues to fuel the industrial market, according to CBRE. Other drivers include an uptick in home furnishings, building suppliers, and factory orders overall. Additionally, inventories, shipments, and consumer confidence continue to rise, which is a good indication that production, investment, and growth will persist.

Multifamily — The gap between renters-by-necessity and lifestyle renters has accelerated. As of March 2017, Yardi Matrix reports the average difference between the segments has climbed to 180 basis points compared to 80 basis points more gains for RBN than Lifestyle in November 2016. Markets in the Pacific Northwest led rent increases: Sacramento, Calif., at 10.1 percent; Seattle at 7.5 percent; and Portland, Ore., at 6.8 percent. The markets with the lowest increases reflected a combination of oversaturation, affordability, and a slowing economy. These markets included Houston at -0.2 percent, San Jose, Calif., at 1.1 percent, and Washington, D.C., at 2 percent.

Office — The attraction of urban offices for millennials lifted the office sector out of the Great Recession, but the suburbs continue to gain market share, according to Marcus & Millichap. 2017 will mark the high point in construction completions for the current cycle, adding 82 msf of space, slightly exceeding the new space developed during 2016. The high absorption rate of 83 msf in 2016 spurred a 20-basis-point decline in the U.S. vacancy rate to 14.3 percent and will result in an increase for average asking rent of 3.5 percent.

Retail — Cushman & Wakefield predicts store closures will most likely intensify during 2017. To achieve growth for traffic in malls, food and entertainment will move from secondary to primary positions. Inventories for both bricks-and-mortar and online merchandise has to become the right inventory close to the customers, which is available to them at the right time. For all retailers, the biggest hurdle continues to be moving products the last mile for buyers. 

Continue Reading

Education Course Ad 300x250 PNG 2

Advertise with Us

Reach more than 45,000 top-performing commercial real estate professionals with CIRE magazine’s print, podcast, and online offerings.

Download the Media Kit

Ad: CIRE Podcast


This Is the Altered Normal

Fall 2020

Esri’s data on consumer behavior, demographics, and employment can help real estate adapt in the COVID-19 world.

Read More

Building Progress

Fall 2020

Moody's Analytics Reis Chief Economist Victor Calanog, Phd, CRE, outlines how construction in many sectors will fail to meet expectations for 2020.

Read More

Market Trends in Commercial Real Estate

Summer 2020

Office Renters Change Priorities in Wake of Pandemic | Recreational Real Estate on the Rise | Case Study: COVID-19's Impact on Eastern PA Big-Box Market | Hospitality Owners Have Reservations as Occupancy Drop | Seniors Housing Responds to Mounting Pressure from Pandemic | Mixed-Use Developments Can Keep It Local | Supply Chain Reacts to Social Distancing | Self-Storage Weathers Early COVID-19 Storm

Read More

The CMBS Stress Test

Summer 2020

The commercial mortgage-backed securities market is particularly vulnerable amid the COVID-19 pandemic, with borrowers and lenders looking for creative solutions to unprecedented problems.

Read More