Market analysis
Roadmap to Recovery
By Anthony M. Graziano, CRE, FRICS, MAI |
Integra Realty analysts were asked to rank from 1 to 12 (1 being most important) the factors that will have the most profound influence on commercial real estate values in the local market. With a 99 percent response rate, the priority average rankings yield some interesting insights into the future.
Unequivocally, real estate value follows job growth, and this clearly remains the No.1 factor in every U.S. market. Of interest also is how relatively unimportant the government bailout programs were ranked relative to housing stability and banking stabilization. Provided that the housing market continues its move toward increased stability, which will also bolster consumer confidence, the biggest challenge facing commercial real estate in the coming 12 months will be finding investors with equity, much of which evaporated in the stock market in the preceding months.
Influential Factors
|
Factor
|
Average rank (1 being most important)
|
|
Job growth
|
2.9
|
|
Improved consumer confidence
|
4.1
|
|
Banking stabilization
|
4.1
|
|
Housing market stability
|
5.0
|
|
Investor equity availability
|
5.2
|
|
Investor interest
|
5.6
|
|
Improve stock market performance
|
6.8
|
|
Government bailout
|
8.2
|
|
Stronger dollar
|
8.2
|
|
Rise in Inflation
|
8.7
|
|
Domestic tourism
|
8.8
|
|
International tourism
|
10.1
|
Source: Integra Realty Resources survey