Strong industrial markets, rent gains and a growing interest in medical office buildings brought an upbeat perspective to the nation’s top commercial developers, despite concerns that the economy and property market fundamentals are losing steam.
That’s according to the National Association of Industrial and Office Properties Vital Signs members’ survey.
Doug Herzbrun, managing director of CB Richard Ellis Investors, which sponsored the survey, described the commercial real estate market as the most guarded it’s been in years.
Through 2006, rents were up in industrial markets, office rents were up and biotech/life sciences facilities and telecom hotels and data centers remained low.
Medical office space appears to be the fair-haired sector, ranking high with 62 percent of those polled.
At the same time, new mixed use development saw a decrease in confidence, “due largely to the deterioration in demand from the residential component,” NAIOP said in a press report issued today.
Financing for commercial projects, in contrast, has tightened significantly in 2007, compared to prior years.
Forty percent of survey respondents think the national economy is growing, the lowest reading since 2003, and only 27 percent are positive about financing, down from 78 percent in 2006.