Dividend Capital’s Q3 2016 Commercial Real Estate Cycles Report

Once again one of my favorite quarterly blogs – writing on Dr. Glenn Mueller’s Real Estate Cycles from Dividend Capital. Such a mass density of valuable data in so little space. Powerful.

Dr. Mueller’s analysis covers 55 of the major commercial real estate markets in the U.S. This is the one report that shows how property types are performing today in a supply and demand framework.

I often receive requests for the summary of Dr. Glenn Mueller’s quarterly report on commercial real estate cycles well in advance of the quarter end. That’s how valuable it is. The Cycle Monitor – Real Estate Market Cycles from Dividend Capital is an excellent resource for checking the pulse rate and blood pressure across commercial real estate markets.

Dr. Mueller is a professor for the Burns School of Real Estate and Construction Management at Denver University. He is also the real estate investment strategist at Dividend Capital Group, where he provides real estate market-cycle research and investment strategy for Dividend Capital’s Real Estate Securities. In my opinion, Dr. Mueller is the premier recognized expert in the study of commercial real estate cycles in the U.S.

Dr. Mueller defines four distinct phases in the commercial real estate cycle. These cycles provide intervals for investment and exit strategies for real estate investors.

  • Recovery (declining vacancy, no new construction)
  • Expansion (declining vacancy, new construction)
  • Hypersupply (increasing vacancy, new construction)
  • Recession (increasing vacancy, more completions)

The following table summarizes the latest findings for each of the property types in the study. Occupancy rates increased in all property segments – though minimally. Rents were up in each of the property types in Q3 2016 and in the prior 12 months, showing the strength overall of U.S. commercial real estate. Industrial is literally remains hot. Hotel had a zero occupancy rate change in Q3 2016, Apartment dropped 0.1 percent with all others rising 0.2 percent.

12-2-16 table

To download the latest full report of Dr. Glenn Mueller’s Dividend Capital Real Estate Cycles Report click http://info.dividendcapital.com/rs/751-HQV-963/images/Cycle%20Monitor%2016Q3_FINAL.pdf?mkt_tok=eyJpIjoiTnpsaFpHTXdOV1kyT0RZNCIsInQiOiJuTWhZRUt6S0ZCcTQwbWVYemJqam9naHowYWxIQ0c0eWtQTDdmaHgzWlcwXC82SUEwZEVvN21xbVwvQ3R2NTJwd0JjZWYzZ3V3ckUyUElZT3ROWFpYYkErS0lLcmZJV3A1MkxJS0VGQzZDSEdZPSJ9

Pay attention to each of the property types in the report focusing on cities that have excess supply, and also those with supply trailing demand.

To obtain reports from prior quarters email: dividend.capital@dividendcapital.com

Dividend Capital has several Real Estate Investment Trusts (REITS) and specializes in real estate investments. To learn more about Dividend Capital click http://www.dividendcapital.com

Finally, to find out more about Dr. Glenn Mueller click http://daniels.du.edu/faculty-staff/glenn-mueller/

If you are involved any way in commercial real estate in the major markets across the country, this is a must-read report. Kudos to Dr. Mueller and Dividend Capital.


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