New EA Repeat Rent Series Puts Office and Industrial Rent Changes in Clearer Perspective
A unique element of EA’s value stream is the management, improvement, and development of rent “price determination models” and the identification and evaluation of those rent inputs and resulting outputs on an ongoing basis. In partnership with EA’s founder, Professor Bill Wheaton from the MIT Center of Real Estate, EA has developed a new rent series that leverages a repeat rent methodology – the gold standard in economics.
Trends in the industrial sector remained strong throughout 2020, as a surge in e-commerce spending helped to support warehousing demand during the COVID-19 pandemic. E-commerce spending increased over 30% throughout the year, gaining a significant share in the retail sector as concerns over the pandemic pushed shoppers online.
We expect a major increase in the retail availability rate which is forecasted to reach its peak in Q4 2021 at 12.5%, 386 bps higher than the pre-COVID level. We forecast that rents will fall and reach the bottom in Q1 2022.