Office, Industrial Markets Continue to Improve

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The third quarter of 2013 brought good things across the US Office and Industrial real estate markets. Despite rising interest rates and weak growth overseas, the US clung to slow-but-steady job growth and limited new office development to cut the supply of excess space.

Both the office and industrial sectors showed improvement. This quarter’s overall office vacancies decreased in 8 of 13 major US markets, led by an increase in demand for insurance, technology, and financial service companies. The professional and business sectors alone have added an estimated 614,000 jobs in the last 12 months.

The industrial side of things also posted positive numbers as the US continues to see an increase in demand for logistics, transportation, automotive, and food service facilities. Industrial vacancies decreased in five of the twelve major industrial markets and remained the same in an additional five markets.

Both office and industrial rents have increased modestly in the past few quarters, and we are seeing development in both industries increase to meet local demand.

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