Beige Book: Upswing in Retail and Industrial, Improvements in Lending
- Mar 08, 2010
March 8, 2010
By Allison Landa, News Editor
When Jones Lang LaSalle released its Beige Book business survey this month, parts of the report were rosy with optimism.
While announcing the findings of the survey, senior vice president with capital markets Raj Aidasani said that it indicated continued improvement in economic conditions. “While commercial real estate remained weak, some regions noted stabilization and even signs of improvement according to the Fed,” he said.
Aidasani added that consumer spending improved in most parts of the country – a positive sign for retail – and manufacturing activity was on the rise with significant gains in the high-tech, auto and metal industries. As for lending, he said banks are remaining cautious, but credit standards appear to be leveling and large banks are becoming more interested in lending to prime borrowers.
In the hotel sector, tourist activity was reported as increased to mix, with some upticks in hotel occupancy.
“Though specific to the hotel sector, the reported increase in occupancy and tourism is encouraging,” Aidasani told CPE. “Combined with the increase in consumer spending, this trend indicates that we may be seeing the beginnings of an upswing in other commercial markets.”
The office sector is seeing steady vacancy rates, but a continuing decline in rents, with much of the recent leasing activity for relatively small blocks of space.
The survey mentions nine regions that showed improvement: Boston, New York, Philadelphia, Cleveland, Chicago, Minneapolis, Kansas City, Dallas and San Francisco.
Inclement weather played its part in the survey. In Philadelphia, retail sales were moving up slowly until snowstorms hit in February, while New York saw increased hotel occupancies and theater activity until the snowstorms. Home sales and construction were hampered by storms in the two cities as well.