Just as in residential real estate, there was a big pullback in the commercial real estate during the recession. But now that the broad economy is in a recovery, do we also see improvement in commercial real estate? N.C. State University economist Mike Walden answers.
“The general answer is yes …. It’s important to realize commercial real estate really has three parts, office, retail, and industrial. All of those are showing some signs of improvement here in North Carolina. For example, in the office area vacancy rates have leveled off or fallen and rents are beginning to rise. You see the same with the industrial part of commercial real estate. Probably the sector where we have the most mixed result is for retail. We’re not seeing the same kind of improvements in retail as we’re seeing for office and for industrial. Also, I should say that certainly just like with residential real estate, commercial real estate is not back to pre-recessionary levels. But it does look like that sector is past the bottom. And I think this is important as we have optimism about the future economy. I think that’s going to fuel some continued improvements in commercial real estate.