A friend forwarded me a copy of “17 Reasons it’s a Great Time to be Alive” by Matt Ridley, as told to John Dyson in the April 2012 issue of Readers Digest. I like uplifting reading, and my interest was initially drawn to the article is because I just turned 54, the same wise old age as the author. Mr. Ridley’s insights are full of wisdom far in excess of his age, and he is an un-apologetic optimist.
Fifty years ago things were not as great as we reminisce. I won’t go into all of Ridley’s 17 reasons it is so great now, but here are some of my favorites:
• We Earn More. The average human now earns triple the amount of income, adjusted for inflation versus 50 years ago.
• Better Nutrition. We consume 20 percent more calories. (Maybe not all that good for some.)
• Health Care. Two-thirds fewer kids are dying from disease.
• Cleaner Environment. United States lakes, rivers, streams, air, and oceans are getting cleaner all the time due to environmental laws and better technology, such as cleaner burning engines and fuels.
• We’re Not Running Out of Oil. In 1970, there were 550 billion barrel of proven oil reserves. We consumed more than 600 billion by 1990 and reserves had grown to 900 billion barrels. This doesn’t count the tar sands and shale, which may contain 20 times that amount. We have plenty of time to figure out how to replace these fossil fuels with renewable sources.
From the commercial real estate perspective, we have weathered two months of frightful global headlines. Although we may not have a Teflon market, consider the recent data from Costar: DFW Industrial absorption exploded during the second quarter of 2012 to 4.3 million square feet, vacancy dropped to 9.5 percent from 10.1 percent.
Office absorption almost doubled to 610,000 square feet, and vacancy dropped to 16.1 percent from 16.3 percent. Cap rates and interest rates are lower, year to date sales are higher and construction remains at historic low levels.
Optimists are right much more often than the pessimists. The commercial real estate business needs more optimists.
Jim Hancock has served as managing director and senior advisor for Sperry Van Ness since 2006. Contact him at Jim.Hancock@svn.com.