Home Archives February 2009 Commercial real estate hits lows

Commercial real estate hits lows

| Print |  Email
Sunday, February 01, 2009

STATEWIDE — Commercial real estate markets nationwide and in Oregon will bottom out this year, and not see a meaningful recovery until 2010, according to a joint report by PricewaterhouseCoopers and the Urban Land Institute.

Oregon’s commercial real estate market is frozen, paralyzed by cautious lenders and investors holding on to their assets waiting for real estate prices to continue falling. Grubb & Ellis, one of Portland’s largest real estate services and investment firms, estimates that commercial sales volume in Oregon fell to $1.7 billion in 2008, down from over $2 billion in 2007.

“Investments across the board have come to a screeching halt,” says Patricia Raicht, VP Client Services Manager for Grubb & Ellis. “There is no money to buy anything.”

This scares investors and brokers alike, who see the freeze in the credit market as particularly worrisome given the amount of commercial real estate debt that exists on the market.

The $700 billion bank bailout will do little to ease the credit crisis until banks begin to invest money back into the market, says Christine Kosydar, a partner at Stoel Rives, which specializes in business finance and real estate law. Banks are sitting on their money, waiting to purchase discounted portfolios to offset past losses, she says. Until then “they won’t be making any loans. They won’t be refinancing much at all.”

Vacancy rates for office, industrial and multifamily rose in the fourth quarter of 2008. Industrial and multifamily vacancy rates rose to 12.11% and 4.1% respectively. Portland’s central city office vacancy rates rose slightly to 9.25%, while suburban office vacancy rates rose to 16.17%.

Retail vacancy held steady at 5.8%, although industry experts predict this number will continue to rise in 2009 as heightened profits from holiday sales give way to post-holiday sales drop-offs.

NICOLE STORMBERG



Have an opinion? E-mail This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

 

More Articles

Private liberal arts education: superior outcomes, competitive price

Contributed Blogs
Tuesday, August 26, 2014
0826 thumb collegemoneyBY DEBRA RINGOLD | OP-ED CONTRIBUTOR

Why has six years become an acceptable investment in public undergraduate education that over-promises and underperforms?


Read more...

Report Card

September 2014
Tuesday, August 26, 2014

Strong public schools shore up the economy, survey respondents say. But local schools demonstrate lackluster performance.


Read more...

Startup or Grow Up?

September 2014
Tuesday, August 26, 2014
BY JON BELL

Startup culture is all the rage. Is there a downside?


Read more...

Who said we should sell in May?

Contributed Blogs
Friday, July 18, 2014
BullMarketBY JASON NORRIS | OB GUEST CONTRIBUTOR

Back in May, we shared a common Wall Street quote about investing, “Sell in May and go away.” Fast forward to July and the most common question we have been getting from clients is, “When is the market pullback going to occur?”


Read more...

The Alchemist

September 2014
Tuesday, August 26, 2014
BY LINDA BAKER

David Howitt explains why Portland consumer brands like Stumptown and Voodoo Doughnuts are taking the world by storm.


Read more...

Molecular Movies

September 2014
Wednesday, August 27, 2014
BY LINDA BAKER

Dr. Chong Fang isn’t God. But the assistant professor of chemistry at Oregon State University is getting closer to figuring out how he put everything together. 


Read more...

Launch

September 2014
Tuesday, August 26, 2014
BY JESSICA RIDGWAY

September's Launch article features Orchid Health, BuddyUp and Inter-Europe Consulting.


Read more...
Oregon Business magazinetitle-sponsored-links-02
SPONSORED LINKS