Commercial Real Estate Rocks On As Stock Markets Tumble
According to a report by Marcus & Millichap (shown: M&M's NYC HQ), commercial real estate is still going strong, despite the Dow and Chinese market falling to shambles. Just like construction, commercial property investment has formed a “stable foundation” for the US economy as investors—both foreign and domestic—seek the security of hard assets and have supported increased property values. “We’re still in the middle of what I expect to be a strong bull market in the real estate asset class,” NAREIT SVP of research and information Brad Case says. And with low interest rates (which could change very soon) and 1,500,000 new jobs this year alone, the demand is only going to keep increasing. Construction's winning big also, emerging as one of the strongest sectors of the US economy. The stock market volatility did put a dent in one commercial real estate sector, as REITs took a hit in August. As strong as the market is, an international "shock-level event" could cause a crumble, though the likelihood of that happening is pretty small, the report says. [GS]
