Some Question the Commercial Real Estate Recovery

Posted by Daniel Jones on Apr 18, 2011 5:42:00 PM
Whistling Thru the Graveyard: Could CRE Follow Housing Into Another Trough?

By Mark Heschmeyer

..."I am questioning the recovery in commercial real estate. The recovery has been very bifurcated," Klassen said. "Trophy properties in prime markets are fetching bubblicious prices because large institutional investors have cash burning a hole in their pockets. But from the folks we speak to, the secondary markets are still very dead."


"The risks we face in 2011 are greater than 2010," Klassen added. "The most significant risk is the end of fiscal and monetary stimulus in the first half of this year. It will take a lot of steam out of the economy. To me, prudence would dictate waiting until the end of summer to see how things pan out. By then, we will also know the extent of state and local government job losses, which may be significant according to what we are hearing in Texas. I wouldn’t want to be signing pricey contracts before then..."

http://www.costar.com/News/Article/Whistling-Thru-the-Graveyard-Could-CRE-Follow-Housing-into-Another-Trough-/127862

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