New Life for an Aging Economic Expansion?

In this market briefing, Colliers International outlines current economic and property market conditions and provides insight into what we can expect in the coming year and beyond. We take stock of key economic and market indicators as well as the likely impacts of policies anticipated currently being proposed and evaluated by the presidential administration and Congress.

KEY TAKEAWAYS

  • Faster economic growth and strong job growth will continue to provide a firm foundation for solid property fundamentals in 2018. However, stubbornly weak wage growth will limit gains for the multi-family and retail sectors.
  • Synchronized global growth as well as tax reform and regulatory relief is fueling a significant pickup in business investment, even as consumer spending slows.
  • The industrial sector will continue its star turn as the best-performing property type, and the sector most desired by investors. Much of its success is at the expense of the beleaguered retail sector, where the shakeout will renew in force after the holiday season.
  • The multifamily sector will suffer some moderate growing pains next year as construction peaks, reducing occupancy marginally and limiting rent gains, but fundamentals remain strong.
  • Supply and demand dynamics in the office sector should remain broadly in tandem next year. But the uptick in GDP, and potentially job growth, should spur more need for office space.
  • Though property markets likely peaked for this cycle in 2015, both leasing and sales transaction activity remain robust and pricing firm. But price appreciation and rent growth will continue to slow in most markets.