Office rents are skyrocketing [emphasis added] across the nation, driving up costs for businesses large and small, thanks to a dearth of space in some major markets, and a new breed of deep-pocketed landlords who can afford to hold out for premium tenants.
Nationwide, effective rents on office properties - the amount tenants pay after concessions - jumped an average of 3.1% during this year's second quarter, up from gains of 2.8% in the first quarter and 2.1% in the year-earlier period, according to a report that was to be released on Thursday, by real-estate research firm, Reis Inc.
That was the sharpest quarterly increase since the third quarter of 2000.
Wow! Three percent! Not one percent! Not two percent! But three percent!
No wonder REITs had doubled in five years! It will take commercial real estate a mere 23 years to double leases at this rate.
Disclosure: The author owns IYR.
IYR 1-yr chart: