U.S. GDP growth slowed to 2.0% in Q3 2021, below expectations of 2.8%. Supply chain disruptions weighed heavily on certain sectors of the economy. This was particularly evident by a 42% drop in motor vehicle production, which alone subtracted 2.4% from GDP growth.
  
CBRE forecasts GDP growth of 4.6% in 2022, leading to stronger real estate fundamentals across the board. We also expect that supply-chain disruptions will ease significantly over the next several quarters. The potential for additional government spending on infrastructure could also provide a near-term boost while also improving longer term growth prospects.

Executive Summary:
U.S. GDP grew by 2.0% on an annualized basis in Q3 2021, below the consensus estimate of 2.8%.

• A confluence of factors led to slower growth, including supply-chain disruptions and an uptick in COVID infections from the delta variant.
• Growth was driven primarily by consumer spending on services and business spending on inventories and equipment.
• The commercial real estate industry recovery is well underway and should remain on track as growth picks up in the coming quarters.

Commercial Real Estate Highlights:

Office
Amid a broader slowdown in growth, office demand drivers such as intellectual property products and financial services continued to show resilience. This will support office demand as companies weigh a broader return to the office following the latest downturn in COVID infections.

Retail
Consumer spending growth slowed to 1.6% in Q3. Supply-chain disruptions should ease significantly next year. Combined with an improving public health outlook, this will bode well for retail sector fundamentals.

Industrial
Economic growth and COVID-related disruptions have put supply chains under tremendous strain, leading to more demand from producers for industrial & logistics space to increase inventories and diversify production amid continued consumer spending. The sector’s outlook remains very favorable.

Multifamily
Demand for multifamily properties should remain strong thanks to an improving job market and rising home prices. However, supply-chain disruptions to the construction sector may limit near-term supply growth.

Hotels
Accommodation & food services contributed to GDP growth in Q3, fueled by a strong job market and robust personal savings rates. CBRE expects continued recovery for the sector as economic growth continues and the delta variant subsides.

This outlook bodes well for already firming office demand. Industrial & logistics markets will remain fueled by the need for increased capacity to keep up with consumer demand. Retail and hotels will benefit from an improving public health environment, though recovery in these sectors will be somewhat uneven. Furthermore, we see less risk of COVID-related disruptions in 2022 due rising vaccination levels, new therapeutics and greater awareness of how to limit the spread of the virus.

TUCSON, ARIZONA ––  A .71 acre infill parcel was purchased by Best Neighbor, LLC of Tucson (David Malboef, member) for $630,000 ($20.48 PSF). The property is located in Barrio Viejo and will used for a multifamily infill project.

Meaning “old neighborhood” in Spanish, Barrio Viejo is known for its brightly-colored adobe houses, Mexican cantinas and hip eateries and pubs.

Barrio Viejo offers a colorful look at the Mexican heritage and vibrant communities that have shaped Tucson’s urban life. It’s great for foodies and history buffs for an afternoon of exploring. Barrio Viejo is an underrated gem in one of Arizona’s most historic cities.

This old neighborhood is packed with 19th century homes. Historically, it was home to some of the city’s most prominent families and notable civic leaders. And in those days, the barrio boasted a colorful street life that reminded some of old Mexico. Up until the 1880s, it was a Free Zone with few policemen.

In the 1880s and 90s it was home to a diverse community of working class people from Europe, Africa, Asia and Mexico, many who worked on the Southern Pacific Railroad. When the tracks were finished, Tucson went from a dusty little town to a city of opportunity.

But many of the homes in Barrio Viejo fell into disrepair in the mid 20th century. The construction of a convention center in 1971 led to the levelling of some 80 acres and razing of homes that displaced 725 residents. The surviving adobe homes make up one of the largest collection of 19th century adobe buildings in the U.S.

These days, Barrio Viejo is a vibrant commercial and residential community in the heart of Tucson adjacent to the Tucson Convention Center and many governmental buildings that make it a desirable place to live or to locate or expand a business

Jim Storey with Tierra Antigua Realty in Tucson handled the land sale for both buyer and seller, Arizona Territorial Lands, LLC  (Donald Rollings, manager) also a long time developer in Barrio Viejo.

For more information, Storey should be reached at 520.977.6311.

To learn more, see RED Comp #9218.

GLENDALE, Arizona – Marcus & Millichap (NYSE: MMI), a leading commercial real estate brokerage firm specializing in investment sales, financing, research and advisory services, announced today the sale of BevMo!, a 14,956-square-foot net-leased property located in Glendale, Arizona. According to Ryan Sarbinoff, regional manager of the firm’s Phoenix office, the asset sold for $4,765,000 ($319 PSF).

Mark Ruble and Chris Lind, investment specialists in Marcus & Millichap’s Phoenix office, had the exclusive listing to market the property on behalf of the seller, a limited liability company. The buyer, another limited liability company, was procured by Ruble and Lind.

Built in 2000, BevMo! is situated along the dense Bell Road retail corridor, surrounded by numerous national retailers. Two miles off the Loop 101 and Interstate 17 freeways, the location is visible to over 61,800 vehicles per day on the hard corner of West Bell Road and North 67^th Avenue. There are 329,015 residents within a five-mile radius in the Phoenix MSA with an average household income exceeding $94,000 annually. BevMo! is located at 6712 West Bell Road in Glendale, Arizona.