Industrial and Office Property Values On the Rise, Retail Headed Down, Survey Reveals
By Barbra Murray
The future still bodes well for the office and industrial sectors, according to the Royal Institution of Chartered Surveyors 2019 Q1 U.S. Commercial Property Monitor report. However, survey participants indicate that more downward movement is on tap for the retail sector.
On the whole, according to the report, “results show sentiment in the real estate market remains generally solid in the first quarter of 2019.” RICS’ Occupier and Investment Sentiment Indices—which reflect a combined measure of short-term supply, demand and expectations indicators—recorded readings of +8 and +7, representing a continuation of the modest momentum seen in the fourth quarter of 2018. However, at the sector level, sentiment was more of a mixed bag.
Occupiers’ 12-month rental value projections suggest that prime industrial properties will see the highest increase, an anticipated jump of approximately 3.5 percent. Prime office follows closely, while secondary industrial ranks a distant third. For the retail sector, the numbers take a negative turn, with an expected drop of approximately 4 percent in secondary retail rents and 0.5 percent in prime retail.