Commercial Real Estate Spikes after Hurricane Katrina

Mortgage Banking, November 2005 | Go to article overview

Commercial Real Estate Spikes after Hurricane Katrina


THE DEMAND FOR COMMERCIAL REAL ESTATE space following Hurricane Katrina spiked in the regions surrounding the disaster zone, providing additional stimulus to major commercial market sectors that were already experiencing growth, according to an analysis by the National Association of Realtors (NAR), Chicago.

Key industries in the affected zone will need to rebuild or relocate in order to survive, said David Lereah, NAR's chief economist.

"We've been hearing about rapid absorption of commercial inventories in nearby areas that survived widespread hurricane damage. In addition, the need has extended geographically to other areas, with increased demand for space in adjacent states," said Lereah. "The greatest demand appears to be in the industrial, multifamily and office markets, but the long-term impact from Hurricane Katrina is uncertain as displaced tenants rethink their future."

With operations shifting away from New Orleans, at least for the short term, markets such as Houston and Dallas-Fort Worth, Texas; Atlanta; Tampa and Miami, Florida, could see vacancy rates for office and industrial space decline by two to three percentage points by the end of 2006. Rent growth will rise along with new demand, but it remains to be seen how much of the relocation will be permanent, according to NAR.

The NAR forecast of the four major commercial sectors-office, retail, industrial and multifamily-was based on an analysis of second-quarter data in 57 major metro areas.

In the office sector, vacancy rates were at the lowest level since 2001, resulting from a rise in space absorption and a decline in speculative building. Expect office vacancy rates to drop to 13 percent by the end of the year and to 11.3 percent by the fourth quarter of 2006, down from 15.4 percent in 2004. NAR forecasts office rents to grow 4.4 percent both this year and in 2006, after rising only 0.4 percent in 2004.

Areas with the lowest office vacancies include Ventura and Orange Counties, California; New York City; West Palm Beach, Florida; and Washington, D.C.-all with vacancy rates of 8.6 percent or less.

NAR projected net absorption of office space at 83.4 million square feet this year and 69.9 square feet million in 2006, compared with 77.7 million square feet absorbed last year and 20 million square feet absorbed in 2003.

The industrial sector also has seen gains as trade and shipping patterns continued to impact the market. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Commercial Real Estate Spikes after Hurricane Katrina
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.