The news these days is filled with forecasts of an imminent recession and the troubled state of the nation’s economy. There is no question that the sub-prime debacle has played a significant role in the economic downfall and has taken its toll on the real estate market with foreclosure rates steadily on the rise. However, within the commercial brokerage sector, there are some emerging trends that seem to bode well for tenants and investors alike.

Due to economic stressors, many property owners find themselves with increased vacancies, creating a favorable situation for tenants. While it is true that many retailers have retrenched, others are pursuing expansion to take advantage of this shift in the marketplace. Our research indicates that Chicago’s urban core is still a tight market, but the outlying suburbs are rife with attractive opportunities. Explosive population growth in counties such as Kendall and Will is adding to the allure of these suburban sites.

The banking industry has also helped to create new opportunities in the commercial real estate market. In previous years, banks were opening at a rapid rate; with new branches seeming to pop up on every corner. Given the current economy, many banks are now consolidating, as seen locally with Bank of America’s acquisition of LaSalle Bank. This trend in the industry directly affects the commercial sector. We anticipate that a number of sites will be coming back on the market at very agreeable rates.

In addition, banks have substantially tightened lending for non-credit deals thereby causing a dramatic slowdown in all speculative deals, and land prices are undergoing a correction. Investment dollars are still chasing “income in place” deals and cap rates remain low.

With the retrenchment of many retailers, developers have found themselves with space for which they previously had commitments. Therefore, it is the landlords and investors who have positioned themselves to be more aggressive and creative in their lease negotiations that have the advantage in today’s marketplace. The brokers at Baum Realty Group have weathered all types of economic storms and, regardless of the climate, are well versed in what is required to match tenants and landlords for long-term success.

What Happens in Vegas?

ICSC is what happens in Vegas and the BRG brokers will be there in full force! It looks like this year’s event is shaping up to be a lively one, so be sure to contact any one of our brokerage team members to set up an appointment before the big day arrives.

Mark your calendars (May 18 –21) and make your reservations because what happens in Vegas doesn't have to stay in Vegas. The BRG brokers can help you bring home the best options for success.