NEW YORK CITY-The results of our latest GlobeSt.com reader survey are in and they are surprisingly, well, unsurprising. In fact, they mesh almost totally with the end-of-year market reports that predicted a steady, slow growth for the coming year. With the launch of the new generation of GlobeSt.com coming as the old year wound down, we thought it appropriate to ask our readers what they thought 2013 would bring for their firms.
The overwhelming majority (54%) believe “It Will Be More of the Same Slow Growth.” The other two choices were almost evenly split, with 25% “Expecting a Banner Year” and 21% unsure enough to believe, “It Totally Depends on the Economy.”
Certainly in terms of hiring, as we reported Monday, the hiring picture is expected to stay the same for 44% of respondents to SelectLeaders’ annual survey. Some 38% believe it will increase and 18% expect to see it drop.
This uninspired outlook was echoed at CREFC‘s annual meeting in Florida, where Jennifer LeClaire reported on the mood: “The closest example we have to what we’re facing right now is Japan in 2002, but Japan is not a relevant model,” one panelist said. “This environment won’t evaporate overnight. Slow growth and negative growth is expected.”
According to one presentation, capital goods orders peaked in Dec. 2011. Even if housing picks up at a rapid clip, one panelist said, it won’t make much impact on the economy. “The labor market is still a drag and Federal Reserve polices have been contradictory,” one panelist said. But there is a bright side: market dynamics are rapidly shifting, as evidenced by the recent Fannie Mae and Freddie Mac settlements.
Paul Bubny covered a national outlook Webinar sponsored by Cushman & Wakefield last Friday, and guess what? “The good news is that absorption has been positive, but slightly less positive” than in 2011, said Maria Sicola, head of US research. Although rent growth overall has been flat when both CBD and suburban markets are factored in, conversely rents have not been declining, she said.
But the economy looms large over the market, casting a big shadow over projections, thanks in large part to our elected representatives inside the Beltway. We’ve gone from debates over the debt ceiling, to a fiscal cliff and back to debates over the debt ceiling, underscoring the 21% in our poll who are watching the economy.
Accordingly, Bubny reported, “risk-taking behavior” will be low across the US among office-using employers. Two sectors that are exceptions to this rule are technology and energy, and Sicola noted that rent growth and leasing activity have been brisk in cities where these tenants have a strong presence, with San Francisco a notable case in point.