Consensus forecast: continued improvement.

Author:Tucker, Michael

* The economy--and real estate capital markets--should improve in the coming years, a panel of real estate economists reported in October.

The Urban Land Institute (ULI)/Ernst & Young Real Estate Consensus Forecast predicted that gross domestic product (GDP) will grow 1.9 percent in 2013, 2.6 percent in 2014 and 2.9 percent in 2015. Unemployment should fall to 7.2 percent by the end of this year, 6.8 percent in 2014 and 6.3 percent by the end of 2015.

"According to this survey, real estate investors anticipate that the improving U.S. economy will continue to help strengthen real estate markets," said Howard Roth, global real estate leader with Ernst & Young, New York. "The results are truly promising for commercial real estate and housing sectors, showing increasing confidence going forward."

The twice-annual forecast calls for 10-year Treasury note rates of 3.0 percent, 3.4 percent and 4.0 percent in 2013, 2014 and 2015, respectively. April's forecast projected 2.3 percent, 3.0 percent and 3.5 percent Treasury note rates, respectively, for 2013-2015.

But Anita Kramer, vice president of Washington, D.C.-based ULI's Center for Capital Markets and Real Estate, said opinions could evolve because participants responded before the ongoing federal government...

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