Reliance on property management will rise in 2015

Office vacancies have fallen sharply in 2014.

It has been a good year for the U.S. real estate industry, which is expected to grow 2.1 percent by the end of 2014, including more than 3 percent in the final six months of the year. Analysts expect this positive trend to continue into 2015, largely buoyed by transit-oriented development and the conversion of unused office space in urban areas.

In most major cities, property rates have spiked while vacancies have fallen. According to Real Capital Analytics, office sales in downtown markets totaled $20.1 billion through the first three quarters, a 39 percent increase over the same period of 2013. Capitalization rates fell to 5.7 percent for offices and 5.1 percent for apartments in central business districts.

Writing for REJournals.com, Alter Asset Management president Sam Gould predicts some adjustments for the market next year. While overall growth will continue, he believes there will be greater stability. With less available space, the performance of existing assets through rising rents and new occupancies will be the major driver in 2015. Thus, property management will become a much more important part of the real estate market's growth.

As a result of this trend, Gould says that the property management sector will trend away from the mid market and toward the extremes, with large corporations and small local companies dominating the industry. These local property managers will successfully cement their place thanks to their specialized knowledge of their regions.

Graveco's lease accounting software assists property managers with essential tasks for commercial and residential properties of all types, from single-family homes and apartment buildings to shopping centers and storage facilities.