Commercial Real Estate gets “Green Light” for 2017

By guest blogger Jan Leighton, CRS, GRI

The movers and shakers of the commercial real estate world gathered for their annual economic forecast on January 20, 2017. The day itself was grey, drizzly and cold, but inside the Grand Ballroom of the Arizona Biltmore it was bright and upbeat.

The Institute of Real Estate Management (IREM®) Chapter President Libby Ekre and Certified Commercial Investment Member (CCIM) Chapter President Rick Padelford did a masterful job with a varied and hard hitting morning agenda.

Arizona REALTORS® was keynote sponsor of the Jerry Colangelo Impact Award and the keynote speaker. 2017 First Vice President D. Patrick Lewis gave a short summary of this year’s legislative agenda and then turned the spotlight on Arizona’s own Jerry Colangelo, who presented this year’s Impact Award to Sandra Watson, president and CEO of the Arizona Commerce Authority.

Keynote speaker Rod Santomassimo, CCIM, founder and president of The Massimo Group gave a fast and furious presentation about the Three P’s: Prospecting, Presence and Personal Growth.

The panels that followed focused on Industrial, Office, Multifamily and Retail. Panelists were asked at the end of their respective panels, “So…green light or red light?” Their response was a unilateral “GREEN LIGHT” for the commercial market:

  • Capital is available and institutional capital likes the diversity of the Phoenix Metro area
  • Developers like good labor, good freeways and good cost of living
  • The West and Southwest Valley are strong in industrial development
  • Scottsdale/Kierland and Tempe are seeing good growth, absorption rates and rents in Office
  • Industrial and Office are constructing speculative buildings in the Valley.

It was the consensus that development costs will rise this year, as labor costs increase and land acquisition prices rise. They also agreed that lender rates are going to rise.

All participants agreed that the commercial market would continue to be strong and consistent in 2017.

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