Article submitted by Matthew Shirley, Leasing and Sales Agent for Saurage Rotenberg Commercial Real Estate

Written by Carisa Chappell, April 16, 2013Fundamentals in the commercial real estate industry are expected to improve significantly over the next three years, according to a recent survey of economists and analysts from real estate organizations.

The Urban Land Institute (ULI) noted that equity REITs are projected to post double-digit returns in 2013 and 2014 in its recently released ULI/Ernst & Young Real Estate Consensus Forecast for April 2013.

Calvin Schnure, NAREIT’s vice president of research and industry information and contributor to the semi-annual survey, explained that underlying this favorable performance is an expectation that GDP growth will re-accelerate to 3 percent or more in 2014 and 2015. This rebound comes after slowing slightly in 2013, due to the federal sequester and fiscal cliff deal. The unemployment rate is projected to move down steadily over the next few years, to 6.5 percent in 2015.

“The overall economy continues to improve, despite bumps in the road like the recent government sequester,” said Schnure. “The recovery in commercial property markets is still in the early stages, with lots more upside than downside risks.”

When it comes to individual sector returns, the survey noted that multifamily will likely continue to lead the way, but with other sectors not far behind.

Schnure said that conditions are expected to stay tight in multifamily housing, with vacancy rates remaining at or near their current low levels. He added, however, that rent growth is expected to decelerate, especially as the single-family housing market rebounds. Single-family housing starts are projected to rise from 535,300 in 2012 to 700,000 this year,

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Matthew Shirley joined Saurage Rotenberg Commercial Real Estate in January 2011. Matthew is a graduate of Louisiana State University with a degree in International Trade and Finance. While at LSU Matthew was a member of Omicron Delta Epsilon The International Honor Society for Economics. Matthew’s professional memberships include the Greater Baton Rouge Association of REALTORS® Commercial Investment Division and the Louisiana Commercial Data Base (LACDB).

Saurage Rotenberg Commercial Real Estate is a member of the Baton Rouge Area Chamber of Commerce (BRAC); the West Baton Rouge Chamber of Commerce; the Baton Rouge Growth Coalition; the Baton Rouge Better Business Bureau; the Louisiana Commercial Data Base (LACDB); and the International Council of Shopping Centers (ICSC). Several agents, on an individual basis, are members of the Society of Industrial and Office Realtors® (SIOR), the Certified Commercial Investment Member Institute (CCIM); the National Association of REALTORS® (NAR); and the Greater Baton Rouge Association of REALTORS® Commercial Investment Division (CID).