Earlier this month, the Federal Reserve Bank released its most recent edition of the Summary of Commentary on Current Economic Conditions, also known as the Beige Book. The publication, which is issued eight times a year, is based on reports from the Bank’s 12 districts and includes insights into the state of commercial real estate across the country. Although the information is anecdotal, it provides valuable information that can add color to existing knowledge of where we are in this stage of the commercial real estate cycle.
Since mid-2015, the Federal Reserve and other regulatory agencies have expressed concern about the boom in commercial construction activity. Much of this concern has been focused on multifamily development in particular—especially the rate of increase in activity since the trough of the 2009 housing-led recession and financial crisis. Many economists and industry experts have joined regulators in signaling caution over the past few years, although those fears have not materialized yet—at least not on a national scale.