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Slow and Steady Wins the Race

Written by Posted On Friday, 16 October 2015 08:00

When CBRE released their 2015 New England Market Outlook Report earlier this year there was noticeable collective happy sigh in Boston’s commercial real estate community. After all, there were high hopes for 2014 after we saw significant improvements in 2013’s real estate market that 2015 would be the year we would achieve complete recovery. However it seems that slow and steady will win this race and for most, as long as the market keeps improving, it can take as long as it needs.

America’s recession was deemed over more than 5 years ago. Since then, we have seen a steady improvement in the overall economy which culminated in a positive year in 2013 with evident growth. In 2014 we saw the strongest 6 month growth period in a decade. Boston is the largest real estate market in New England and while many “mega deals” went through in 2013, the focus shifted back to smaller, local growth. Due to this, urbanization has become a rising theme as Boston dweller chose to live work and play in the inner Boston locales. In 2014, four non-functioning office buildings were converted to multi-dwelling apartments bringing 1,100 new residences in 2015 and another 900 expected in the next few years.

In terms of venture capital investment, New England is the third highest ranking after New York and Silicon Valley. Commercial space still remains at a premium with a high demand for top quality locations. New construction continues to accommodate this demand. The technology sector along with several other industries are occupying amenities rich spaces in the urban center. With increasing demand expected not to slow in 2015, the emphasis is on quality rather than quantity. In this light, there is competition among property owners to offer premium accommodation.

It is not surprising that Boston is seeing a consistent steady increase in the real estate sector. It has been voted number 1 in America as the healthiest city, the 3rd most walkable city and notably, the number 1 best city for beer in the Northeast.

Although housing sales in Massachusetts have seen a slight drop recently, Massachusetts realtors remain unruffled as housing market predictions could best be described as moderate but steady. If there is any concern at all it is regarding a shortage in housing inventory and new construction activities will not be enough to cover the widening gap between supply and demand. An increase in sales throughout the real estate sector is expected to increase but the Massachusetts Association of Realtors tells us it will be slight.

 

For 2015 New Englanders can loosen their seatbelts and stop asking “are we there yet?” and sit back and enjoy the scenery for although we are in for a longer ride than expected, it looks like there aren’t any bumps in the road.

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Daniel Palmier

Accomplished CEO, passionate philanthropist and dedicated family man, Daniel Palmier is firmly rooted in the Boston community, having given back to a number of organizations throughout the city, particularly to Boston’s Catholic Schools Foundation. Daniel has a holistic approach to philanthropy which includes local and overseas causes.

www.danielpalmier.com

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