NAR: Credit crunch hits commercial real estate

Forecast shows waning investor confidence, hard-to-get financing

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Commercial real estate market fundamentals are fairly stable, although investment is waning following a record year in 2007, according to the latest Commercial Real Estate Outlook of the National Association of Realtors. NAR Chief Economist Lawrence Yun said the commercial real estate market is holding essentially even. "We're seeing no significant changes in vacancy rates or rent growth, so the fundamentals in commercial real estate still seem to be respectable," he said. "Under normal circumstances, near-full occupancy coupled with positive rent growth would be of strong interest to investors, but we're not seeing that. The credit crunch has filtered into the commercial real estate market." Patricia Nooney of St. Louis, chair of the Realtors Commercial Alliance Committee, said the investment cycle appears to be turning. "It looks like investors are taking a wait-and-see attitude," she said. "Even with fairly stable fundamentals and ca...