A look at the commercial real estate transactions in the first quarter of 2011 showed that office buildings, retail shops, restaurants, industrial buildings, warehouses and apartment buildings weren’t selling as well.
The only thing that did sell well in the first quarter of 2011 was farms and farm land.
In January, February and March, there were 109 commercial property deals for a total amount of $44.8 million.
The number of deals were up slightly from the 108 completed in the first quarter of 2010, but the volume fell 15.3 percent from the $52.9 million last year.
More concerning is the sales mix. Farm and farm land sales accounted for nearly 74 percent of the first quarter 2011 volume. Farm deals made up just 31 percent of the commercial sales volume in the first three months of 2010.
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Being in commercial real estate I have to concur with the author here. Commercial real estate is slow. Both industrial and retail have a considerable amount of “shadow inventory” (underutilized space) to use up before they will lease, buy or upgrade their facilities. The office market appears to be dead, and may never come back except in the larger metropolitan areas.
Some are forecasting a recovery in 2012, but it will be a while longer for the retail, office and industrial markets to come back. There is some recovery underway for distribution centers taking place, but that is mainly taking place in the larger metropolitan areas, like Chicago.