The amazing rebirth of Boston from a second-tier, provincial city to a top target for global property investors is well underway. At Bisnow’s Boston Forecast 2016 earlier this week, real estate legends and experts told a packed house what the new year will bring.

The crowd filled the Ritz on the Commons. Next year, fundamentals will stay strong. The Dow is hitting historic highs, and Massachusetts unemployment is hovering around 5%. The supply of Class-A offices and luxury residential still will be constrained. For the first time in decades, the city’s population is growing, as The Hub evolves into a more alluring place—especially for Millennials—to live, work and play. Capital is rediscovering the city on the hill and since they’re finding a scarcity of product, they’re driving prices up and cap rates down. More investors are landing here from abroad: China, Norway, Sweden and Canada.

With the scarcity of core assets, investors may shift toward middle market properties, says Boston Realty Advisors founder Jason Weissman, who gave the 2016 economic forecast. Office vacancy rates will keep declining and cap rates will continue to head south by about 50 basis points. Last year, four out of five deals were by companies in industries that previously were only minor players downtown: life science, pharma and healthcare. Millennials accounted for about 75% of Boston’s population growth, Jason says. Look for office vacancy rates in Boston and Cambridge to drop by 200 bsp and rents to rise. Since 2010 in the popular East Cambridge and Seaport office markets, asking rates have jumped nearly 65%, he tells us. In the severely supply constrained luxury condo sector, the only major projects are Millennium Tower, One Dalton, 50 Liberty and Pier 4 (for which BRA’s Advisors Living is the marketing consultant).