www.marejournal.com
4C— February 27 - March 12, 2015 — Commercial Office Spotlight — Mid Atlantic Real Estate Journal
C ommercial O ffice P roperties Many markets heading into 2015 on solid footing Cushman & Wakefield releases 2015-2016 Global Office Forecast
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and energy sectors – which is translating into strong office market fundamentals. “De- mand, particularly for newly constructed or refurbished space, is on the upswing,” Sicola said. “While rental growth has moderated in some markets, more than 80 percent of the locations in the study will experience rent growth exceeding inflation.” The changing workforce presents a significant driver of the U.S. office market recov- ery. “The millennial genera- tion is exerting its influence on where it wants to work,” ·
Sicola said. “Atlanta, Chicago and Dallas are experiencing increased leasing velocity and have joined the ranks of San Francisco, Seattle, Boston, New York and Houston with respect to improved funda- mentals.” The Canadian office market continues along a path of re- covery as well. Strong demand in Toronto is ushering a new era of growth; 5.1 million square feet of new space will come online through 2017. In Montreal, the Deloitte Tower will rise, while Calgary and Vancouver both will see new
supply come online as well. Consolidations and densifica- tion remain the norm in most Canadian markets, while the flight to quality is creating vacancies in some older office stock. Mexico City has risen as the star of the Latin Ameri- can office market, due in part to energy reforms and sec- ondary laws passed by Con- gress, which have opened up the country to increased for- eign investment. While GDP growth was below expecta- tions in 2014, robust growth is projected over the next several years there. But South American mar- kets are lagging behind es- pecially in Argentina and Brazil, where both production and consumption levels are dampened. While the Santiago office market in Chile has been ahead of the curve, recent trends have moved it in line with other markets, which are not expected to fully recover until 2017. ASIA PACIFIC Japan and India are among the strongest performers in Asia in terms of economic growth and stability. Office market demand in Tokyo is being driven by strong corpo- rate profits, while in India in- formation technology-related tenants continue to dominate the landscape. Singapore is also benefitting from tech growth, as it tends to be the next destination, along with the Philippines, after India for multi-nationals. Not surprisingly, rental growth among established markets is expected to be strongest in Tokyo and Sin- gapore, while many emerg- ing markets will experience above-average growth. Across much of China, rents will grow moderately or remain stable. “While the modest pace of growth in Asia Pacific markets resulted in a subdued leasing environment in 2014, activity is set to gain traction next year,” Sicola said. “Most core markets will boast relatively low vacancies through 2015 and 2016, with the exception of cities in Australia, and some emerging markets in China and India.” Economic conditions across Europe remain mixed, but on the whole, a recovery is taking shape. “The outlook is brighter than it has been for a consid- continued on page 16C
the office real estate sector, with many markets heading into 2015 on solid footing,” said Maria Sicola, who heads Cushman & Wakefield’s Re- search for the Americas group. “Of course, some markets in or near areas of political insta- bility and those with stalled economic growth continue to struggle; but overall, things are in better shape than they were 12 months ago.” As the North American mar- ket bright spots, U.S. cities are experiencing economic expan- sion – even beyond those domi- nated by the robust technology
EW YORK, NY — Commer c i a l rea l estate services firm
Cushman & Wa k e f i e l d released its 2 0 1 5 - 2 0 1 6 Gl obal Of - f i c e F o r e - cast. The re- port tracks current and anticipated
Maria T. Sicola
class A office market trends in The Americas, Asia Pacific and Europe. “From a global perspective, 2014 was a stronger year for
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