The global economy clearly lost considerable strength this year. Global real GDP growth is tracking to come in at 3.0% for 2019—its slowest pace since the global financial crisis. Although commercial real estate (CRE) leasing fundamentals remain broadly stable, it is also evident that the pace at which businesses were gobbling up space decelerated against the weaker macroeconomic backdrop. As the Q4 data rolls in, global net demand for office space is tracking to be 7% slower in 2019 versus a year ago. Industrial-logistics is tracking to be 17% slower. To be clear, demand for space is still positive, still healthy. The world is expected to absorb another 800+ million square feet (msf) of space in 2019, but it has simply gotten slower relative to the last couple of years. Likewise, through three quarters, global capital markets sales volume is trending to be down around 10-15% in 2019. Same story, still good—still tracking to be the 3rd or 4th highest level of volumes on record—just not as good. Of course, the slowing trajectory was not felt equally across all product types and geographies. Indeed, many cities reported stronger demand for space this year and/or stronger sales, but in the aggregate, the general theme was that 2019 was a weaker year, both for the economy and property markets.
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