Page 8 - 2019 Colliers Forecast Book
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8   Colliers International | West Michigan

                                                               West Michigan Industrial
                                                               Transactions and Listing Rate Trends
                                                               Source: Colliers International Research Department

                                                                 45                                            6
                                                                 40                 Weighted Average   Weighted Average
                                                                                       Listing Rateng R  Linear Regression  5
                                                                                       Listing Rate
          company’s needs but also creating space for future expansion.   35
          This allows for short-term landlord fl exibility while reaping the   30                               4
          benefi ts of construction economies of scale.           25                                            3

          Industrial land sales should continue to be active, and investor  Numer of Transactions  20             Price per Square Foot (NNN)
          sentiment in the product type will again be very positive.   15                                      2
          As we reach the peak of the market, some current owners will   10                               1Q19 - PROJECTED  2Q19 - PROJECTED
          look to exit and take their gains, while out-of-market investors   5                                 1
          who have exhausted all of their opportunities in major markets   1Q16  2Q16  3Q16  4Q16  1Q17  2Q17  3Q17  4Q17  1Q18  2Q18  3Q18  4Q18
          will continue to look towards secondary markets like West   0                                        0
          Michigan and view it as one of the last remaining places to get   Number of Lease Transactions
          yield. The problem facing sellers is where to roll the proceeds   Current Industrial Vacancy Rate
          into, as options are scarce and with stock market volatility
          and capital gains tax implications, exiting the commercial real   Source: Colliers International Research Department
          estate investment market can be unappealing.

          As we look ahead, the short-term forecast for industrial real   GENERAL INDUSTRIAL
          estate is promising, thanks to a strong economy and e-commerce
          trends. Further out, trade disputes and growing labor shortages
          represent rising headwinds. The U.S. and local economies   FLEX
          continue to fi re on most cylinders, despite these headwinds.
          Economic growth for the year should again be strong, though   WAREHOUSE/STORAGE
          the recent pace will not be sustained much longer. Job growth
          remains very strong but continues to ease as we are nearing
          full employment and wage growth is reaching its targets, and   MANUFACTURING
          the Federal Reserve Board will continue its pace of moderate
          hikes through next year, in its quest for a soft landing in 2020   TOTAL
          or 2021.                                             0%    1.0%  2.0%   3.0%   4.0%  5.0%   6.0%   7.0%
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