Research
Oct 15th
Third quarter 2012 reports are available here for the St. Louis industrial, office and retail sectors. Check out the reports for details on vacancy and rental rates, absorption, construction trends and major lease transactions. You can also receive the reports via email by joining our email list. Look for more information on market trends in the weeks to come as Vice President Andy Murphy, CCIM is published in the November issue of Heartland Real Estate Magazine.
1st Quarter 2012 Market Reports Now Available
Apr 7th
First quarter 2012 reports are available here for the St. Louis industrial, office and retail sectors. Check out the reports for details on vacancy and rental rates, absorption, construction trends and major lease transactions. You can also receive the reports via email by joining our email list. Look for more information on market trends in the weeks to come as principals John Sheahan, Peter Sheahan and Carl Conceller participate in interviews with industry publications.
NAI DESCO Quarterly Industrial Report Now Available
Oct 17th
After vacancy rates decreased to 7.9% at the end of 2010 compared to 10.6% at the end of 2009, industrial vacancy rates have once again risen to 8.8% at the end of Q3 2011 with negative net absorption. New construction starts have picked up again throughout 2011, with over 500,000 square feet delivered to the market in Q2 & Q3 2011, and 139,000 square feet currently under construction.
Rental rates in the industrial market have declined steadily throughout the year, settling at $4.06 per square foot at the end of Q3 2011 compared to an average of $4.20 per square foot at the end of Q3 2010.
Click here to read our full St. Louis metro industrial report, featuring detailed submarket information and major transactions from the quarter.
NAI DESCO Quarterly Retail Report Now Available
Oct 17th
NAI DESCO is pleased to announce that our 3rd Quarter 2011 Retail Report is now available.
The metro St. Louis retail commercial real estate market is still undergoing a transition period at the end of Q3 2011 as the overall economy remains shaky. On the bright side, vacancy rates continue to decrease and are down to 7.9% across all retail sectors. However, restricted lending and a troubled economy continue to create a slight downward pressure on average asking rates across all sectors, which have dropped from $12.36 per square foot at the end of Q3 2011 from $12.51 per square foot at the end of 2010.
No new square footage was delivered to the market in in Q3 2011, however 323,292 square feet are currently under construction, It will remain to be seen how this additional space will affect the retail market moving into 2012.
Click here to read our full St. Louis metro retail report, featuring detailed submarket information and major transactions from the quarter.
NAI DESCO Quarterly Office Report Now Available
Oct 17th
NAI DESCO is pleased to announce that our 3rd Quarter 2011 Office Report is now available.
The overall office vacancy rate at the end of Q3 2011 was 12.4%, showing a 1% downturn over the vacancy rate as of a year ago. The Fenton and Manchester/270 submarkets maintain some of the lowest office vacancy rates in the metro St. Louis area, while the Earth City submarket reflects some of the highest vacancy rates.
Over the entire metro St. Louis market, asking rates at the end of Q3 2011 were $17.95 compared to $18.65 at the end of Q3 2010, suggesting the market may not improve for landlords for some time to come.
Click here to read our full St. Louis metro office report, featuring detailed submarket information and major transactions from the quarter.
NAI Chief Economist: Beware of Inflation
May 12th
As inflation takes hold, generations that have never witnessed inflation will experience its destructive power, says NAI chief economist Dr. Peter Linneman. In his new white paper, Dr. Linneman discusses the potential effects inflation will have on the commercial real estate industry. The following is an excerpt:
No one deserves less forecasting credibility than the Fed. Over the last two decades, their macroeconomic forecasts have been among the poorest of any forecasters, despite the fact that they are the only forecasters who know macro policy decisions before they are announced. The Fed’s abysmal forecasting record makes our record look extraordinary, as at least we forecasted a 2009 recession in early 2006. Even as the recession was well under way, the Fed was saying there was no recession. Yet the Fed’s forecasts continue to gain respect.
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Risky Business: Change and Opportunity Shape our Future
Mar 14th
The following is an excerpt from Vice President Tom Erman’s presentation at the annual St. Louis SIOR Forecast breakfast:
I saw an article recently that stated “If we are always looking in the rear view mirror it is hard to keep our eyes on the road ahead.” The lesson is obvious, we can not ignore the past but rather we should learn from it and have the ability to quickly look forward and responsively meet the challenges of our daily tasks.
In the early 90’s we saw the commercial real estate market in a state of upheaval, with the savings and loan debacle causing values to plummet. The eventual result was a turn around starting in the mid 90’s with values of properties reaching market level heights not seen before.
NAI DESCO Quarterly Industrial Report Now Available
Feb 17th
After minimal shifts in the early portion of the year, the industrial market showed improved net absorption through the end of 2010. Less than 200,000 SF of new industrial space was delivered in the current year, a historic low, which assisted in absorption gains. The combination of increased absorption and lack of new construction lowered the industrial vacancy rate in the St. Louis metro area nearly three percentage points over the past year, from 10.6% at the end of 2009 to 7.9% at the end of 2010.
Vacancy rates in both flex space and warehouses have trended downwards, and overall vacancy in St. Louis is approximately two percentage points lower than in the United States as whole.
Rental rates in the industrial market have hovered steadily around $4.20 per square foot for the past year, with little upwards or downwards movement.
Click here to read our full St. Louis metro industrial report, featuring detailed submarket information and major transactions from the quarter.
NAI DESCO Quarterly Retail Report Now Available
Jan 31st
The metro St. Louis retail commercial real estate market is looking better at the end of 2010 than it did a year ago. Vacancy rates continue to decrease and are down to 8.1% from 9.0%. However, weak demand and a troubled economy continue to create a downward pressure on average asking rates, which have dropped from $13.22 per square foot at the end of 2009 to $12.51 per square foot at the end of 2010.
Net absorption in the fourth quarter was positive 340,000 square feet, continuing a trend of positive net absorption through the entirety of 2010. Very little square footage was delivered to the market in 2010 compared to 2009, so the combination of ongoing positive absorption and minimal new deliveries to the market should promote a continued downward trend in the vacancy rate moving into 2011.
Click here to read our full St. Louis metro retail report, featuring detailed submarket information and major transactions from the quarter.
NAI DESCO Quarterly Office Report Now Available
Jan 27th
Overall, 2010 was a difficult year for office landlords. Sluggish demand placed downward pressure on rental rates and the limited pool of potential tenants were in a position to obtain lease concessions. Office tenants also faced a challenging year, wanting to reduce space if possible or avoid signing new long-term leases until the economy attained a greater degree of stability. Landlords and tenants reached a compromise with the “blend and extend” method, earning extended leases for landlords and rent concessions for tenants.
The office vacancy rate at the end of 2010 was 11.4%, showing a slight improvement over the 11.8% vacancy rate at the end of 2009. A bright note in the St. Louis market was Clayton’s ability to absorb most of the 485,000 SF Centene building with little change in the Clayton vacancy rate, indicating better market conditions for Class A space than in the overall office market.
Over the entire metro St. Louis market, asking rates at the end of 2010 were $18.65 compared to $18.35 at the end of 2009, suggesting the market may be starting to look brighter for landlords moving into 2011.
Click here to read our full St. Louis metro office report, featuring detailed submarket information and major transactions from the quarter.
