Aareal Bank - Competitors

Aareal Bank Competition

Now Viewing Aareal Bank's competition in: Real Estate Brokerage and Management

Recent Developments

US Office Vacancy Rate Rising - The US office vacancy rate, an indicator of office rental demand, posted a quarterly increase for the first time in four years, according to Grubb & Ellis. The office vacancy rate rose to 13.5 percent in first quarter 2008 from 13 percent in fourth quarter 2007. Grubb & Ellis had predicted that the office vacancy rate would remain flat at 13 percent throughout 2008.

US Construction Decline Continues - Total US residential construction put in place, a demand driver for real estate brokerage and management services, fell 5.1 percent in the first five months of 2008 compared to the same period in 2007. Residential construction fell 27 percent; nonresidential construction rose 14.5 percent. Office construction, an indicator of demand for office space management, rose 17.7 percent.

Industry Professionals Pessimistic - Increasing economic weakness is leading to rising pessimism among US commercial real estate professionals. About 60 percent of commercial real estate professionals surveyed by accounting firm Grant Thornton say that they expect commercial building vacancy rates to increase during 2008. Almost half are pessimistic about the commercial real estate industry's outlook in 2008; only 5 percent were pessimistic in 2007.

Competitive Landscape

The profitability of real estate management companies (which have mainly fixed costs) depends on demand for the properties they're associated with or the volume of transactions they handle, both of which are usually higher during periods of strong economic growth and can be negatively affected by a recession or by too much new construction. Large companies have only modest economies of scale and benefit mainly from better name recognition than smaller competitors.

Full Industry Overview For Real Estate Brokerage and Management

Real Estate Brokerage and Management Industry Forecast

from Hoover's/D&B subsidiary First Research

The output of US real estate businesses, which includes real estate management services, is forecast to increase at an annual compounded rate of 4.7 percent between 2007 and 2012.

Real Estate Growth Steadies

First Research forecasts are based on INFORUM forecasts that are licensed from the Interindustry Economic Research Fund, Inc. (IERF) in College Park, MD. INFORUM's "interindustry-macro" approach to modeling the economy captures the links between industries and the aggregate economy.