Livingston Predicts Year-End Rally for Warehouse, Distribution, Manufacturing

The office sector, however, will stay soft throughout next year, the founder/chairman of 12-year-old Realvest Partners Inc. tells GlobeSt.com.

New residential construction (single-family and multifamily) will remain strong. So will construction and service provider companies.

"To take advantage of the recovery, industrial property companies should budget for a rising trend in 2002 and 2003," says Livingston, who is also the Central Florida chapter president of the National Association of Office and Industrial Properties. "The recession is over and recovery is under way in most sectors of the economy."

He basis his analysis largely on the Federal Reserve's Industrial Production Index which was at a cyclical low in December 2001. "Cyclical recovery is evident in all regions across the country and in the economies of Europe, Asia and most of South America," Livingston says.

That may be, but in Orlando some property owners are reeling from first-quarter vacancy levels that are at five-year-lows in several submarkets.

For example, Cushman & Wakefield of Florida Inc. puts metro Orlando's overall office vacancies at 18.7%, up from 17.1%. Industrial is at 9.2%. Grubb & Ellis Co. shows office vacancies at 15.5%, up from 14% in fourth quarter 2001.

Bulk distribution centers are at a 14.94% vacancy level and service center/flex space is at 16.74%, according to Rebman Properties Inc. of Maitland, FL.

That doesn't burst Livingston's bubble. He cites new studies by Brian Beaulieu of the Institute for Trend Research in Contoocock, NH which expects interest rates to rise modestly by year end with the improving economy, a factor that will obviously affect new commercial and industrial developments.

"Monetary policy is still aggressively expanding," Livingston says.