Technology and energy firms aiding commercial real estate recovery
West coast technology and energy firms led the recovery in the commercial real estate market in the second quarter of 2012, according to Jones Lang LaSalle.
The Second-Quarter 2012 Office Highlights report showed the technology industry accounted for 46 percent of net absorption in the market, while the energy industry accounted for 23 percent. Vacancy declined 17.3 percent to its lowest level since early 2009.
“Outside of the technology and energy markets, we're not seeing many segments demonstrating growth,” said John Sikaitis, senior vice president of research at Jones Lang LaSalle. “While Mid-Atlantic cities led our recovery in 2010, New York City and Washington D.C. have moved to flat positions largely because they are closely tied to the uncertainty of Europe and the regulatory and political environments.”
According to the U.S. Commerce Department, commercial real estate conditions have also improved in St. Louis and Kansas City, Missouri. Kansas City has realized price increases attributed to stronger sales.
With multiple signs pointing to a recovery, the market could potentially improve going forward.