Commercial Real Estate Fundamentals Are Down, But Maybe Not for Long

Commercial real estate fundamentals are taking a beating in the current economy with corporate layoffs, a drop-off in consumer spending and general uncertainty causing vacancy rates to rise and rental rates to fall. But the pain may not last long.

Writing in the Spring 2009 Linneman Letter, NAI Global Chief Economist Dr. Peter Linneman notes commercial contracts have fallen off a cliff as few new developments outside of multifamily have secured construction loan commitments since the start of 2008. Linneman expects little improvement in new construction in 2010, despite declining construction costs as weak demand and weak financing sources will shelve all development plans outside of multifamily.

This means that as demand recovers in 2010 it will find little new space coming online to compete with existing space.

NAI Global Named #4 Commercial Real Estate Brokerage in the World

National Real Estate Investor magazine's April issue just arrived, including the annual Top 25 Brokerages listing.

NAI Global was named the fourth largest brokerage, in a tie with Colliers International. NAI's total investment sales and lease transactions for 2008 totaled $42 billion.

Look for the full listing, and an article on distressed properties featuring an interview with Jeff Finn about the Commercial Property PowerSale, on www.nreionline.com.

Auctions: Not Just for Distressed Real Estate

Auctions: Not Just for Distressed Real Estate

Article Finds Commercial Real Estate Auctions Are Not Just for Distressed Real EstateAn interesting article in this week's Global Real Estate Monitor examines the value of auctions in bad economic times. As the article states, "Auctioneers have a saying that when times are good, the auction business is good too, but when times are bad, the auction business is great. And, as more commercial property owners are struggling to deal with under-performing assets or upcoming debt maturities in a frozen debt market, auction experts expect the auction business, also known as accelerated marketing, to be quite busy in the coming months."

The article goes on to make the point that auctions and accelerated marketing programs like NAI Global's Commercial Property PowerSale are not just tools to sell distressed real estate assets, but are also effective in creating competitive bidding for high profile assets. Boston's John Hancock Tower is one such trophy office building on the block, and other high profile office buildings, shopping centers, industrial parks, residential subdivisions and prime development land are expected to come to market via auctions and sealed-bid sales during the coming year.

You can read the entire article at http://nreionline.com/globalrealestate/mar_article2.html