The graph below depicts the historical phases of the Office Market in the Real Estate Market Cycle in Tampa Bay from 2004 to 2012
Indications are that the Office market is now in the Recovery Phase of the Cycle
- The Recovery Phase is typically characterized by:
- Decreasing Vacancy Rates
- Low New Construction
- Moderate Absorbtion Low to Moderate Employment Growth
- Negligible to Low Rate of Rental Growth
DIRECTION = UP DIRECTION = DOWN
0 to 1— RECOVERY — Phase 1 6 to 5— HYPERSUPPLY — Phase 1
1 to 2— RECOVERY — Phase 2 5 to 4— HYPERSUPPLY — Phase 2
2 to 3— RECOVERY— Phase 3 4 to 3— HYPERSUPPLY — Phase 3
3 to 4— EXPANSION— Phase 1 3 to 2— RECESSION — Phase 1
4 to 5— EXPANSION— Phase 2 to 1— RECESSION — Phase 2
5 to 6— EXPANSION— Phase 3 1 to 0— RECESSION — Phase 3
The theoretical Real Estate Cycle is often depicted in the shape of a normal distribution. In practice, the shape may be different.
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