Experts: Commercial Real Estate Market at Too High a GearBy
After driving into a ditch during the worldwide economic meltdown, commercial real estate has taken to the comeback trail way too quickly and could end up crashing again, real estate veterans warn.
Industry executives are concerned that rising real estate prices and easing loan terms — at least for stable properties — are higher than real estate fundamentals, which include measures such as occupancy and rent rates.
Commercial real estate has had a history of highs and lows but in the past, the industry has taken much longer to recover, said Jacques Gordon, global strategist at LaSalle Investment Management. After a recession that economists have compared in severity to the Great Depression, it should have taken more time than usual, not less, for the real estate market to rebound, he said.