As you can see it is down this past year, but given the macro fallout from de-levering banks (i.e. slower economic growth, higher unemployment, tougher credit standards) I believe commercial real estate will suffer considerably. I'll have stats and numbers justifying this call shortly. In the meantime I'll leave you will some quotes about the status of commercial REITS going forward (this was after CB Richard Ellis missed earnings on July 30th):
Goldman Sachs analysts following the company said that CB Richard Ellis was hit by "sharply weaker commission-based investment sales and leasing revenues, both in the U.S. and globally ... which reaffirms our view that a recovery in the back half of 2008 seems unlikely
"The unwinding of the U.S. housing- and mortgage-market euphoria has produced tremors that at midyear 2008 have reached seismic proportions," said Ray Torto, global chief economist at CB Richard Ellis.
Lack of liquidity in capital markets and deteriorating fundamentals are having a negative impact on real-estate investment trusts and related companies, according to Goldman analysts.
"The decline and variance to our estimate was due primarily to a material drop-off in both the property-sales and leasing businesses, and was evident across all regions," wrote Ross Smotrich at Lehman Brothers in a report on CB Richard Ellis. "To the extent that CB Richard Ellis' business is a leading indicator for real-estate fundamentals, the quarter may not bode well for the second half of the year."
IMO, the best way to play the impending price correction in commercial real estate is through the SRS:
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