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

Car Talk

April 2015
Thursday, March 26, 2015
BY LINDA BAKER

Everyone knows cell phones and driving are a lethal combination. The risk is especially high for teenage drivers, whose delusions of immortality pose such a threat to us all. Enforcement alas, remains feeble; more promising are pedagogical approaches aimed at getting people to focus on the road, not their devices.


Read more...

Much ado about data-driven organizations, for good reason

Contributed Blogs
Monday, April 13, 2015
bigdatathumbBY GRANT KIRBY | OP-ED CONTRIBUTOR

The mega-shift from technology-driven to data-driven organizations raises questions about Oregon’s workforce preparedness.


Read more...

Letting Go

April 2015
Friday, March 27, 2015
BY AMY MILSHTEIN

As baby boomers sell their businesses, too many forget the all-important succession plan.


Read more...

6 development projects reshaping Bend

The Latest
Thursday, April 09, 2015
bendthumbBY JACOB PALMER | DIGITAL NEWS EDITOR

Bend has reclaimed its prerecession title as one of the fastest growing cities in the country.


Read more...

VIDEO: The 2015 100 Best Companies to Work For in Oregon

The Latest
Friday, February 27, 2015

videothumbVIDEO: 2015 100 Best Companies to work for in Oregon


Read more...

Oregon Business expands events portfolio

The Latest
Friday, March 27, 2015
htctfacebookBY OB STAFF

New events series brings magazine to life.


Read more...

4 highlights of the MLS labor deal

The Latest
Wednesday, March 04, 2015
timbersthumbBY JACOB PALMER | OB DIGITAL NEWS EDITOR

On Wednesday night, a couple days ahead of the 2015 season kickoff, Major League Soccer and the Players Union reached an agreement.


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