Written by Christine Perez, Senior Communications Specialist
The U.S. economy and property markets performed well despite a turbulent 2016, and they’re positioned for a strong 2017, which should carry over into 2018. That’s the word from Kevin Thorpe, Cushman & Wakefield’s global chief economist.
“Even before the election, U.S. economic fundamentals were showing signs of heating up,” he wrote, in summarizing the firm’s U.S. Macro Forecast for 2017. “Now, when you layer in the expected tax cuts and the potential for new spending from the new administration, it creates an even stronger economic backdrop for property markets.”
In North Texas, Cushman & Wakefield brokers are already seeing an uptick in activity. “Corporate confidence has rebounded since Trump’s election in November,” says Mike Wyatt, executive managing director who specializes in office tenant representation. “It certainly helped us make some deals in the fourth quarter. Businesses are confident that we will see less regulation and more tax cuts, and those things will help them be more competitive.”
Wyatt expects to see growth in several industry sectors. “I think we’ll see expansion in the banking and finance, healthcare, and service industries, because of the Trump effect,” he says. “That sentiment should carry us through at least the first half of the year.”
Cushman & Wakefield forecasts the U.S. real GDP will grow by 2.3 percent in 2017 and hit 3 percent in 2018. “This will be enough to generate more than 3 million net new jobs over the next two years,” Thorpe reports, “and an increasingly robust environment for consumers, driving more demand for commercial real estate space than what was previously assumed.”
The role of the consumer is a huge factor in North Texas, which is experiencing strong population growth. This is fueling demand in every commercial real estate sector, says Blake Anderson, senior managing director in C&W’s industrial brokerage group in Dallas. “People are continuing to move here, and they will continue to need apartments and housing, retail stores, and offices and warehouses to meet their needs,” he says. “As long as we keep everything in balance, don’t build too much of the same product, and manage absorption, the industrial market will continue to be healthy.”