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| Lauren Terschan |
ATLANTA, GA -- The Federal Reserve Bank of Atlanta announces the release of the U.S. Commercial Real Estate (CRE) Momentum Index which combines economic and real estate market data for more than 300 metro areas to provide insight into the momentum of change in CRE markets across the country.
A new interactive market analysis tool will enable users to
track the CRE Momentum Index over time to identify CRE trends and assess market
risks for the four major property sectors—apartment, office, retail, and
industrial—as well as view the underlying variables that affect the index’s
movement.
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| The Atlanta Fed's Brian Bailey. Photo by Sadat Karim |
One of the intended uses of the tool is to help small and medium-sized banks more quickly identify and accurately gauge risk as they are actively engaged in commercial real estate lending.
The CRE Momentum Index combines publicly available economic
data such as employment, e-commerce, retail sales and others, with third-party,
market-specific data such as occupancy trends and construction forecasts.
The
tool also provides a running quarter-to-date analysis as data are released in
order to improve tracking in between quarterly data releases.
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| File photo: Office Tower |
“Exploring both economic and commercial real estate dynamics in tandem helps users understand the movements in commercial real estate markets, and it is particularly helpful to look at these dynamics by property type,” said Lauren Terschan, senior data analytics and real estate specialist in the Atlanta Fed’s Supervision, Regulation, and Credit division, who helped develop the tool.
“By
looking at changes in overall market momentum, this tool will help users track
market undulations and help identify potential risks.”
According to NAIOP Research Foundation, commercial real estate
contributed more than $1.1 trillion to the U.S. GDP and supported nine million
American jobs in 2019.
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| File photo: Shopping Center |
“Commercial real estate is a hugely important sector to the overall economy and contributes significantly to job creation, investment and lending,” said Brian Bailey, CRE subject matter expert in the Atlanta Fed’s Supervision, Regulation and Credit division, who developed the index’s methodology.
“It
is critical that industry participants, lenders and regulators have an
excellent understanding of economic drivers and risks, and we believe the CRE
Momentum Index will help with that understanding.”
The CRE Momentum Index is available in the Data and Tools
section of the Atlanta Fed website.
CONTACT:
Karen
Mracek
470-249-8348
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