Economists confident real estate market will continue to strengthen

Economists think the commercial property sector will improve.

American economists may have calmed some commercial real estate companies' minds, as a survey from the Urban Land Institute showed that the prevailing feeling is that the market should improve over the next three years.

The ULI Real Estate Consensus Forecast showed that by the end of 2014, transaction volume for commercial real estate properties could increase by 50 percent. In addition, vacancy rates are expected to decline for office, industrial and retail properties. These are projected to drop between 1.2 and 3.7 percentage points. In addition, hotel occupancies are also expected to increase.

"While geopolitical and global economic events could change the forecast going forward, what we see in this survey is confidence that the U.S. real estate economy has weathered the brunt of the recent financial storm and is poised for significant improvement over the next three years," said Patrick Phillips, CEO for ULI.

Commercial mortgage-backed securities could double during this time, as well, according to the report. Also, rents could increase significantly for all properties, with the rates for retail properties rising by 0.8 percent and apartment rents jumping 5 percent. These improvements could signal that the market is finally beginning to ramp up its recovery.

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