THE
NATIONAL MARKET TODAY
Some feel as though the market is picking up, and in a sense it is.
Commercial loan activity is picking up, as many investors acquire
multi-family properties at .25 cents on the dollar, as the banks
unload. Although many investors are holding onto their capital as
properties are expected to drop in value over the next 12-24 months.
Contractors, investors and developers are bracing for what could be
the worst real estate crunch since the early 1990s, when the industry
built a small city's worth of speculative office buildings that later
went begging for tenants. Commercial property sales plunged 73% last
year, according to Real Capital Analytics. Vacancy rates are rising,
and hundreds of large properties are in default. The American
Institute of Architects' billing index, a leading indicator of
construction six months ahead, is at a record low. Unemployment in the
construction industry is 15.3%, well above the average 7.2% jobless
rate.
