Newspaper article THE JOURNAL RECORD

'In a Good Place': Oil Prices Won't Hurt OKC Commercial Real Estate Yet, Analysts Say

Newspaper article THE JOURNAL RECORD

'In a Good Place': Oil Prices Won't Hurt OKC Commercial Real Estate Yet, Analysts Say

Article excerpt

OKLAHOMA CITY - Despite the uncertainty in oil prices, commercial real estate brokers expect Oklahoma City's market to remain steady in 2015.

"None of the retailers we talk to at least seem overly concerned with the price of oil," said Jim Parrack, senior vice president of retail at Price Edwards and Co.

Parrack was part of a panel discussion held during the Commercial Real Estate Council's annual forecast event at the Petroleum Club in downtown Oklahoma City. Other panelists were Newmark Grubb Levy Strange Beffort Vice President of Office Blake Renegar, CBRE Oklahoma Second Vice President William T. Forrest, Newmark Grubb Senior Vice President of Industrial Brett Price, and CBRE Capital Markets Senior Vice President Chris Dunning.

Parrack said retail companies get concerned and back down from expanding when income and disposable income levels drop. He said those facets will likely change the longer oil prices stay low. If commodity prices stay low for one or two years, Parrack said, that will affect retail growth.

"I do expect retail to do well over the next year," he said.

The most volatile market when energy prices are unstable is industrial, which has many oil- and gas-related clients. Price described it as driving a sports car on two wheels, meaning the market could either flip over and crash or turn the other way and continue growing. He said since there was new construction in 2014, it's unknown what will happen with those spaces. Nevertheless, vacancy rates have dropped from 14 percent in 2008 to 6 percent in 2014.

Local tenants are quickly absorbing Class A space such as the ShurTech Distribution building near Interstate 35 and Britton Road, which was vacant for less than a day before Crest Foods occupied it. …

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