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There is a lot more to real estate than residential homes. Glenn Mueller, the investment strategist at Dividend Capital Group, a real estate investment company, recently completed his market cycle forecast for office, industrial, apartments, hotels and retail real estate. His research monitors these property types in more than 50 major markets.
He expects the national average occupancy rates to improve in all five property sectors, but at different rates. Here’s an overview of his estimates:
* Office occupancy should improve by a half percent, while rents may increase in the 1%-2% range.
* Industrial occupancy should increase 0.5% and product rental growth rate of 3% in 2006.
* Apartment should see another 0.4% increase in occupancy producing a forecast rental growth in 2%-4% range.
* Retail occupancy should be flat in 2006 but still produce rental growth of 3%-4% in 2006.
* Hotels' 1% occupancy increase should provide a 4% -5% room rate increase, producing revenue per available room growth of 5%-6% in 2006.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.