The numbers are in for last year’s construction starts in the Boston Metro, and they’re quite impressive! According to a year-end report released by Dodge Data & Analytics, as published in Boston Business First, the Boston Metro ranked 7th nationally for total commercial building and multifamily housing starts during 2016. The combined value of the projects is estimated at over $7 billion dollars.
Here’s a closer look at the news, along with our own insights!
The Boston Metro’s construction boom trails just a handful of other major metropolitan areas:
- New York: $29.78 billion
- Los Angeles: $9.82 billion
- Chicago: $8.33 billion
- Washington D.C. $8.15 billion
- Dallas $7.97 billion
- Miami $7.45 billion
Economists at Dodge Data & Analytics cite declining vacancy rates, rising rents, low interest rates and easing standards for commercial real estate loans as contributors to the construction boom during 2016. A strengthening economy and expanding labor market also fostered demand for office space and multi-family housing.
The projections for future construction activity, while positive, have become more conservative. An uptick in multi-family vacancies is expected as completed units come to market. Rising interest rates and a tapering in lending activity suggest a decline in commercial construction projects during 2017.
However, regional economic trends will carry the greatest influence on local commercial real estate markets. The Boston Metro economy continues to expand, and we are seeing commercial growth extend into Quincy and other suburban communities in the area. Absorption of office and industrial space was strong during much of 2016, and the current year is trending along similar patterns.
When you are ready to begin, relocate or expand your business, team up with an experienced commercial real estate broker at Jay Nuss Realty Group, LLC! Whether you are thinking of buying or leasing Boston Metro commercial real estate, we can help you find the ideal property. Please contact us today for expert guidance!