Beige Book: New England saw modest growth, real estate rising

New England experienced modest growth in economic activity, the Federal Reserve’s Current Economic Conditions brief – otherwise known as the Beige Book – reported Wednesday. More

To continue reading this article, please do one of the following.



economic indicators

Beige Book: New England saw modest growth, real estate rising

BLOOMBERG FILE PHOTO/BRENT LEWIN
ACCORDING TO THE BEIGE BOOK REPORT released by the Federal Reserve Bank of Boston, New England saw modest growth in economic activity during the second quarter of 2013 as real estate rose.
Posted 7/18/13

BOSTON – New England is continuing to experience modest economic expansion, the Federal Reserve’s Current Economic Conditions brief – otherwise known as the Beige Book – reported Wednesday.

Retail, manufacturing, consulting and other industries either held steady or experienced small increases in sales through the end of the 2013 second quarter.

In real estate, rents increased on commercial properties, and minor increases in interest rates on residential real estate seem likely to spur more buying activity because of the concern that rates will continue to rise from their still historically low levels.

In addition, most firms, while not doing significant hiring, are maintaining their workforce. Most respondents in all industries expect moderate growth in 2013.

Residential real estate continues to be a major story for the Federal Reserve Bank of Boston report. The Fed’s contacts anticipate that in addition to the incentive to buy that the prospect of higher future interest rates creates, demand for housing, particularly in urban New England, is strong, evidenced by sales increases in May of single-family homes and condominiums.

Despite these promising signs, inventory in Massachusetts and smaller cities across New England remains tight, which in turn is helping prices to rise. Respondents indicated that “inventory remains the most significant constraint on sales growth.”

According to the report, New England commercial real estate markets are “maintaining a solid footing.” Rents in Boston for prime retail properties and offices are either consistent or rising.

In Providence, office leasing negotiations are proceeding “slowly” due to a spike in long-term Treasury rates and the rising rent demands of landlords.

Contacts for retail, tourism and the manufacturing sector reported improving sales trends. Retailers’ year-over-year comp-store sales increased between 1 and 5 percent and demand for apparel, furniture, sporting goods and mobile technology was strong. Hotel and restaurant revenue increased as well, 1.5 and 2 percent, respectively.

The majority of the Fed’s 13 respondents in manufacturing experienced growth in sales as well. Despite the growth, it was also noted that “Europe remains a source of weakness, and China continues to inject volatility for manufacturing exports.”

The Fed’s business services contacts reported a modestly successful quarter as well. Economic consulting experienced high demand though health care, pharmaceuticals and strategy consultants had “mixed results.” Marketing and advertising respondents experienced minor growth.

Half of business services firms reported no new hiring, while the other half planned to grow their workforces by 3 to 5 percent. All but one contact were optimistic about growth staying consistent or improving for the coming year.

Calendar
PBN Hosted
Events

Please join PBN on September 10th for the 3rd Annual Fastest Growing & Innovative Companies program at Rosecliff Mansion in Newport. Seating is limited so be sure to register early.
Advertisement
Purchase Data
Book of Lists
Lists
Book of Lists cover
PBN's annual Book of Lists has been an essential resource for the local business community for almost 30 years. The Book of Lists features a wealth of company rankings from a variety of fields and industries, including banking, health care, real estate, law, hospitality, education, not-for-profits, technology and many more.
Data icons
Data can be purchased as single lists, in either Excel or PDF format; the entire database of the published book, in Excel format; or a printed copy of the Book of Lists.
  • Purchase an e-File of a single list
  •  
  • Purchase an e-File of the entire Book of Lists database
  •  
  • Purchase a printed copy of the Book of Lists
  •  
    National
    Local
    Latest News
    Advertisement