Commercial Real Estate Index
www.hallassociatesinc.com
Hall Associates
Commercial Real Estate Solutions
540-982-0011
Roanoke, Virginia 24011
Transactions Completed in Over 135
Markets Nationwide
Ed Hall
Chairman
CCIM, SIOR, CPM, CRE
ehall@hallassociatesinc.com
540.982.0011
Stuart Meredith
President & Managing Broker
CCIM, SIOR
smeredith@hallassociatesinc.com
540.982.0011
SIOR Index Results
Building on the gains from the tail end of
2011, office and industrial spaces continue to
improve. The first quarter 2012 SIOR survey
recorded strong gains across most market
indicators.
The Commercial Real Estate Index, representing first quarter 2012 data, advanced 7. 2
points. The national index, based on 10 variables pertinent to the performance of U.S. industrial and office markets, rose to 71.0 from 63. 8
in the fourth quarter. The office sector increased
8. 6 points from an index value of 61.0 to 69.6.
The industrial sector rose 5. 5 points to 71.4, mirroring increases in demand for warehouses due
to larger international trade volume.
Commercial markets benefited from a positive environment in the first quarter of the year.
Geographically, all four regions witnessed
improved conditions. Commercial markets in
the South continue to register the strongest relative markets, with an index value of 77.2—up
3. 7 points from the fourth quarter 2011. Markets
in the Midwest and Northeast improved the
most over the quarter, advancing 9. 2 points and
9. 6 points, respectively. Markets in the West
rose 7. 9 points, to an index value of 63. 1.
Leasing activity was positive for the quarter,
and practitioners reported declining vacancy
rates— 53 percent of SIORs pointed out that
vacancies are lower than a year ago. Concessions
remain the norm for 81 percent of respondents.
However, slightly over half of practitioners
reported rents in line with or slightly above long-term averages. In addition, subleasing availability continued to improve, with only 22 percent
of SIORs reporting ample sublease space.
Construction of new commercial space is
thawing out—70 percent of practitioners mentioned there was no new construction in their
market, an improvement from the 85 percent
figure a year ago. Development conditions continued to strengthen—as they remain in buyers’
favor—acquisition prices were lower than construction costs in 79 percent of the markets. An
improving economy reflected well upon local
markets, as only 69 percent of SIORs found
the national economy to have a negative impact
upon their markets (compared with 84 percent
in the fourth quarter).
Based on the results of the first quarter survey, commercial markets continued to ramp up,
following the gains recorded during the prior
quarter. SIOR members expect conditions to
improve going forward into 2012, with 77 percent of respondents expecting a better market in
the next three months.
