Commercial Property Market Update

As the price of commercial property and the amount buyers are willing to pay has seemed to have increased, January of 2008 has seen a major dip in commercial sales volume.

In 2007, office market portfolio sales were recorded at over $10 billion. In January of 2008, only $413 million was reported. In quantity, 2008 saw a decrease from 42 office properties trading in the prior year to only 8 tradings.

Manhatten, home of Donald Trump, and reportedly going full guns when he spoke on Larry King's nightly show last October, has dropped to $613 million from $6.14 billion. The do report another $5 billion under contract, however.

San Francisco reported an increase in office sales, and was the only US commercial market to do so.

Conversely, more than $10 billion of office property was listed for sale in the month of January, which was the highest amount since the beginning of the last quarter in 2007. February listings are expected to be even higher, yet buyers are not willing to pay what sellers are asking, and neither seems willing to compromise.

Industrial markets also fell in sales to below the $2 billion level, for the first time since 2005. Closings dropped 65% from 2007 and are expect to dip further in February after new listings lessened as well.

Commercial apartment sales dropped 47% from 2007 as well, with monthly volume lower than any since 2004. Sellers seemed to disregard the decrease in sales, and the number of apartments put into the sales market in January INCREASED a whopping 84% from 2007.

While sellers are holding strong to their prices, the pressure to ask less is increasing and buyers' resistance is growing. Investors are uncertain and wary of the market as well, hoping that time will bring a price reduction. Though credit is cited as a contributor of the residential real estate slowdown, market uncertainty seems to be the driving force behind the commercial market stagnation.

If you are interested in Myrtle Beach commercial property or 1031 Exchange services, we will be happy to offer a no-obligation consultation at your convenience. Call David O'Connell directly at 843-455-5500, or fill out our contact form. If you are looking for Myrtle Beach real estate or homes in Pawley's Island, North Myrtle Beach or Little River, see our other websites.