The winter/spring 2017 Allen Matkins/UCLA Anderson Forecast Commercial Real Estate Survey, which was conducted after the November 8 election, shows no discernable economic shift in the state, despite Hillary Clinton having been the favorite among California voters. Observations from 2016 remained unchanged, and the natural cycle in commercial real estate appears to be running its course somewhat independent of the presidential contest.
The findings may be due “to the upward bump in consumer confidence and stock prices and in part because the regulatory environment in California is not likely to change much,” said Jerry Nickelsburg, adjunct professor of economics at the UCLA Anderson School of Management and a senior economist with the UCLA Anderson Forecast. “While the outlook for 2017 may look relatively good, the strong move towards online shopping, higher interest rates, a continued redefinition of the office environment and the dropping of fertility rates [remain the] driving factors in commercial real estate.”
Among other findings, the survey provides continued evidence that we are experiencing the end of the boom in office space, that optimism remains strong among developers of multi-family dwellings, and that industrial markets — particularly the warehouse segment — remain on fire.
The Allen Matkins/UCLA Anderson Forecast California Commercial Real Estate Survey and Index Research Project polls a panel of California real estate professionals in the development and investment markets, on various aspects of the commercial real estate market. The twice-annual survey projects a three-year outlook for California’s commercial real estate industry and forecasts potential opportunities and challenges affecting office, multi-family, retail and industrial sectors.