Moving on Down

Weekly initial jobless claims fell to 381,000 in the week ending December 3rd. It was the lowest level since late February and much better than economists’ average expectation of 395,000 in a survey by Bloomberg. The four-week moving average was 393,250, its fourth consecutive week below 400,000. Initial claims below 400,000 signal that the labor market is growing, exerting downward pressure on the unemployment rate.

In another positive economic sign this week, wholesale inventories surged by 1.6 percent in October, pointing to some forward-looking optimism on the part of businesses. The growth in inventories will provide a boost to fourth quarter GDP.

Lastly, Grubb & Ellis expects vacancy rates across all property types to decline in 2012. Details will be forthcoming in our 2012 Forecast report, which will be released on January 3rd.

Commercial Real Estate Vacancy Rates

All sectors of the property leasing market are recovering, some more quickly than others. Third quarter vacancy rates fell by 30 basis points for the office and apartment sectors and by 10 bps for the industrial and retail sectors. The apartment market has been recovering rapidly since mid-2010 thanks to the unresolved foreclosure crisis, tight mortgage lending standards and the tarnished reputation of homeownership.
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