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NEW YORK, Feb. 8, 2016 – Cushman & Wakefield, a global leader in commercial real estate services, announced today the release of its U.S. Macro Forecast, which predicts positive economic results for 2016 despite early year stock market jitters.

Worries about China and oil prices have caused stock markets around the world to stumble, leaving the Dow Jones and S&P 500 both nearly 9 percent lower at the end of January 2016 since late last year. However, history has shown that the stock market is not the best predictor of a recession, and continued moderate growth for the U.S. economy is expected. The 2.4 percent forecast for GDP growth in 2016 is quite healthy in the face of demographic shifts that are putting downward pressure on the labor participation rate. This level of GDP, coupled with the current pace of job growth, is consistent with the robust level of demand for office and industrial space observed in 2015.

“Economic turbulence at the start of a new year is nothing new,” said Kevin Thorpe, Cushman & Wakefield’s Chief Economist. “We have seen it come and go for the past several years without any long-lasting damage to the health of the broader economy. Typically, the volatility drives capital flows back to United States with a refocus on core assets, and that is happening again.   The key indicators to watch right now are consumer confidence and the labor markets. Those are both telling us that the core of the U.S. economy and the property markets are still in reasonably good shape.”

For the U.S. commercial real estate sector, the U.S. Macro Forecast predicts:

  • The office sector is forecast to post net absorption in the range of 75 to 85 million square feet annually over the next two years. Although demand will ease towards the end of the forecast period, new development will continue to lag. As a result, vacancy rates will decline from 14.2 percent in 2015 to 13 percent in 2017, and office rent growth will continue to accelerate, rising to 4.5 percent in 2017.
  • The Industrial sector will face a mix of headwinds and tailwinds, but the overall outlook remains generally upbeat. The headwinds arise from declines in manufacturing activity related to a stronger U.S. dollar and weaker global demand. But these drags will be more than offset by a confident, higher spending consumer, which will boost demand for space related to ecommerce, auto, technology, housing, along with other consumer-related sectors. Although demand levels are expected to cool off, Cushman & Wakefield forecasts overall vacancy will be on par with the tightest conditions ever observed in the sector, falling to 7 percent in 2016.
  • In the retail sector, demand will remain focused on Class A product as well as new space. Vacancy will decline to 7% in 2016, and rental growth will average 2 percent to 3 percent between 2016 and 2017.

“At this tenuous time in the cycle, it is important to remember that the global central banks remain highly accommodative,” explained Thorpe. “Whether it’s by keeping interest rates well below the normalized rate (such as U.S.), or by moving forward with additional capital injections (occurring in many other countries), the bottom line is that they will continue to take extraordinary measures to prolong this business cycle. And more likely than not, those extraordinary measures will continue to create a highly robust, albeit, highly uneven, real estate environment.”

Access this link to download the full U.S. Macro Forecast:


About Cushman & Wakefield

Cushman & Wakefield is a leading global real estate services firm that helps clients transform the way people work, shop and live. The firm’s 43,000 employees in more than 60 countries provide deep local and global insights that create significant value for occupiers and investors around the world. Cushman & Wakefield is among the largest commercial real estate services firms with revenues of $5 billion across core services of agency leasing, asset services, capital markets, facility services (branded C&W Services), global occupier services, investment & asset management (branded DTZ Investors), project & development services, tenant representation and valuation & advisory. To learn more, visit or follow @CushWake on Twitter.