All signs are pointing to a shift in the winds however as commercial real estate activity is on the upswing and lending also appears to be making a comeback.
San Francisco, CA (PRWEB) April 01, 2013
Construction sites and commercial real estate lending have both been very low in volume since 2008, as the commercial real estate sector went into a forced hibernation mode brought on by the financial crisis. Banks and other lenders have been focused on clearing bad and non-performing assets from their books and strengthening their balance sheets rather than pursuing lending opportunities, says Terry Robinson, President of the Off Market Association and Sunovis Financial.
All signs are pointing to a shift in the winds however as commercial real estate activity is on the upswing and lending also appears to be making a comeback. Lenders have made strong headway in the cleansing of bad assets on their books and a credit thaw could become a credit river as early as 2014. Based on data from CoStar Realty Information Group, banks in 2012 increased commercial real estate lending by 3 percent. While this is just a small trickle, some banks increased commercial real estate lending by as much as 15 percent, indicating that the glacier is beginning to thaw.
The Urban Land Institute's "Emerging Trends in Real Estate 2013" points out that there is capital for worthy projects. All signs are pointing to a shift in the winds however as commercial real estate activity is on the upswing and lending also appears to be making a comeback. Lenders have made strong headway in the cleansing of bad assets on their books and a credit thaw could become a credit river as early as 2014.
“We have already seen increased interest in some sectors and regional areas, and that appears to be slowly expanding as this recovery takes hold. Where just 2 years ago there was little to no interest in many property types, investors can now choose from an increasing variety of commercial properties and locations,” said Robinson.
Most notable has been the recovery in multifamily commercial real estate, though other sectors are also beginning to show signs of life. The industrial real estate market has also seen an upswing and is beginning to shift towards a landlords market. Office space also seems to finally be awakening with both investment activity and a demand for construction increasing. All of this points to a strengthening recovery in the commercial real estate market. As this cycle is just beginning it is the perfect opportunity to jump in now, before prices begin to escalate too rapidly.
Judging the best timing for reentering commercial real estate is impossible, but it is better to be too soon rather than too late. Professionals at Off Market Association (OMA) help with this very advice and expertise. With job growth still tepid, the increase in office space growth and appreciation could still take some time. However, once the refinancing cycle ends and vacancy rates drop substantially, a new boom could begin as there is almost no new office space that has come to market in the past 5 years, says Robinson.
About The Off Market Association
The world is changing and has changed. Old ways of doing business don’t always apply. The Off Market Association (OMA) brings a new, exciting and visionary way to do business to all our members.
OMA uses a cutting edge technology and platforms, a deal desk, and extensive contacts across the US for commercial real estate transactions, bank note sales, small business advising and SBA loan services. The OMA is affiliated with Sunovis Financial and Genesis Capital to provide investors with access to capital and quick financing.