A robust American economy is strengthening the fundamentals of the country’s office market, keeping vacancy in check and driving asking rents up, according to real estate investment expert Jacob Frydman. Referencing a report from Houston-based commercial real estate company Transwestern, Frydman discussed the sector’s continued steady improvement across the third quarter of 2018, in which absorption (a measurement of the net change of the supply of commercial space) reached 22.7 million square feet, vacancy remained stable at 10.1 percent, and asking rents increased by 4.0 percent, annually. Frydman pointed to the U.S. economy’s recent strong performance as a primary contributor to the office sector’s improving momentum in a tight labor market. “Real gross domestic product increased at an annualized 3.5 percent, according to first estimates, and personal consumption contributed 2.7 percent to that rate,” said the seasoned investor. A strong economy also means more jobs are being added, which has been reflected by office-using employment increasing by 1.7 percent on an annualized basis. “Because inflation has remained in line with the Federal Reserve’s target of 2.0 percent, consumer and business confidence should keep the office market healthy well into 2019.”
Jacob Frydman is the Founder of White Acre Equities investment firm and a Managing Partner at LambdaStar Infrastructure Partners. He has more than 25 years experience in developing and investing in real estate related transactions, having acquired over five million square feet of commercial real estate and participated in over $1 billion of investment and development transactions over the course of his career. Frydman’s notable transactions include the acquisitions of the Global Crossing New York Headquarters, the Aetna Building, the NBC Television Studios and Two Dag Hammarskjold Plaza.
Jacob Frydman – CEO & Chairman – United Realty Advisors, LP – LinkedIn: https://www.linkedin.com/in/jacobfrydman
Jacob Frydman – Huffington Post: http://www.huffingtonpost.com/author/jacob-frydman