Numbers Up Virtually Across the Board
Published on: Wednesday, December 9th, 2015
The 2015 edition of IREM’s Income/Expense Analysis reports has hit the streets. Tracking a solidifying economy (recent stock market wild rides aside) the outlook is positive in virtually all property types. Here are some highlights from each:
In the office market, total collections for suburban office complexes nationwide in 2014 increased 4.2 percent from 2013 levels to $19.50 per square foot of net rentable area. Downtown properties experienced a 6.8 percent year-to-year collections increase to $22.93 per square foot. Total actual collections for downtown properties were 17.6 percent greater last year than their suburban counterparts, versus 14.7 percent higher the prior year.
In conventional apartments, NOI for garden buildings rose 6.3 percent to $5.91 per square foot; NOI for elevator buildings rose 5.9 percent to $11.07 per square foot; NOI for low-rise buildings with 25 or more units rose a mere 0.6 percent to $6.30 per square foot; and NOI for low-rise buildings with 12 to 24 units dropped 12.9 percent to $4.93 per square foot.
Turning to the operating expenses of federally assisted apartments, Section 221(d)3 low-rise buildings experienced the lowest expenses in 2014 at $5.17. Section 202 elevator buildings reported the highest–at $10.74–in 2014. Total expenses decreased for all garden subsidies over the last two years, with the exception of Section 8 family buildings.
In condos and co-ops, median total annual operating expenses for all condominium building types as a group increased 5.3 percent in 2014 to $2,649.76 per unit from $2,517.25 in 2013. Similarly, condominium dwellers as a group paid 7.0 percent more in assessments last year, with the median monthly assessment amounting to $273.94 per unit, compared with $256.02 the prior year. The typical association added $637.50 per unit to its reserve fund, versus $555.00 in 2013, representing 24.1 percent of total operating expenses.
Meanwhile, median income for open shopping centers across the country in 2014, based on average actual occupancy, increased to $17.70 per square foot from $17.18 the prior year. Open center operating costs increased to $5.27 per square foot from $5.07 in 2013.
For more information, see the 2015 Income/Expense Analysis Reports.
John Salustri is one of the nation’s most respected writers in the field of Commercial Real Estate. A multiple award winner for excellence in journalism, John is the founding editor of GlobeSt.com, the nation’s premier news and information site for the commercial real estate industry. Today John is a freelance writer and editor, focusing on helping companies boost their industry presence through enhanced web and print content.