“The commercial real estate industry is improving, yet is being hindered from reaching its full potential,” says Thomas J. Bisacquino, president and CEO of NAIOP. “Developers and investors have to be able to anticipate levels of demand three-to-five years ahead, but their vision is clouded because of uncertainty in Washington and in state capitals, which explains the slow pace of recovery. If we don’t get clarity on budget policy, tax reform or the renewal of terrorism risk insurance, it will hold us back from our true potential to really drive greater job creation and economic growth in America. We’re working on these issues by actively representing the interests of our industry in Washington and in state capitals.”
The sector reached its equilibrium in 2012 providing the support for broad-based spending in the development (pre-construction, construction and post-construction) of commercial real estate. Construction spending on commercial real estate totaled $100.1 billion, a 9.9 percent increase over 2011.The increases in construction spending and activity resulted in the building of 307.5 million square feet of new space, an increase of 29 percent from 2011.This new space has the capacity to house 775,800 jobs.
The report’s author, economist Stephen S. Fuller, PhD, Dwight Schar Faculty Chair, University Professor and the Director of the Center for Regional Analysis at George Mason University, agreed that growth projections were positive but that there were clouds on the horizon.
“These gains and planned projects face a difficult economic road as current changes in fiscal policy and decreases in federal spending threaten the current projections of increased GDP growth and job creation through 2015,” says Dr. Fuller. “These advances and increased projects are paramount to continued growth in the country, as the U.S. economy cannot achieve sustained expansion in the absence of the development industry’s full recovery.”
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