Gradual Mend for CRE, Says NAR

The National Association of Realtors says that U.S. office vacancy rates will peak at 16.7 percent during the fourth quarter and start a gradual decline after that. The markets with the lowest office vacancy rates currently are New York City and Honolulu, with vacancies around 9 percent.

November 30, 2010
By Dees Stribling, Contributing Editor

Courtesy Flickr Creative Commons user morrissey

The National Association of Realtors says that U.S. office vacancy rates will peak at 16.7 percent during the fourth quarter and start a gradual decline after that. The markets with the lowest office vacancy rates currently are New York City and Honolulu, with vacancies around 9 percent. All the other office markets that NAR tracks have double-digit vacancy rates.

Likewise, industrial vacancy rates are projected to decline slowly from 13.9 percent during the fourth quarter to 13.2 percent in 4Q11, while retail vacancies will be roughly static next year, according to the NAR. The brightest spot among income-producing properties will continue to be multifamily rental properties, the organization noted.

Multifamily vacancy rates, by the NAR’s estimation, will to decline from 6.4 percent in the current quarter to 5.8 percent by the end of 2011. Not only that, apartment rents are likely to rise 0.2 percent in 2010 and another 1.4 percent next year. Multifamily net absorption should be 85,200 units in 59 major metro areas this year, and another 147,000 in 2011.

TARP End Cost: $25B

Since nothing ever really goes away on the Internet, it’s possible to find late 2008- or early 2009-vintage articles predicting that the Troubled Asset Relief Program would cost endless trillions. According to the Congressional Budget Office, the total cost of TARP, which wrapped up earlier this fall, will end up being about $25 billion, otherwise known as chump change in federal budget terms.

Anti-bailout critics have long ago quit beating the dead TARP horse anyway, and these days usually focus on the entirety of government bailouts, including “backdoor bailouts, asset guarantees, low-interest-rate loans [and] free money,” as one web site put it. Trillions might indeed be the correct metric when talking about the worldwide, and continuing, effort since 2008 to prevent a staggeringly deep depression through public intervention in the private sector.

Hardcore anti-bailout commentators deny that such a depression would have happened without bailouts, and in the fullness of time, they might be proven right. Or not. Still, it’s easy to imagine who would have been the first to scream, “Why didn’t the government do something?” had government indifference about the Panic of 2008 been followed by massive economic collapse instead of a very deep recession.

WikiLeaks Might Go After “Major Bank”

According to Forbes on Monday, WikiLeaks–the web site currently adroit at embarrassing the U.S. government by publishing leaked documents, a sort of Pentagon Papers on steroids–will turn its attention next year to “a major U.S. bank.” This kind of document release is matter-of-factly known as a “data dump.”

Money quote from the magazine: “[Wikileaks] offers the conscience-stricken and vindictive alike a chance to publish documents largely unfiltered, without censors or personal repercussions, thanks to privacy and encryption technologies that make anonymity easier than ever before.”

Wall Street spend most of Monday down, but roused itself in the late afternoon and nearly made it to positive territory. Still, the Dow Jones Industrial Average lost 39.51 points, or 0.36 percent. The S&P 500 was down 0.14 percent and the Nasdaq dropped 0.37 percent.