UF: Commercial real estate outlook guarded

Florida Foreclosure & Real Estate News

The effects of the residential real estate slump are starting to spread to the commercial sector, but Florida's commercial real estate market should remain stable, according to a study from the University of Florida.

Researchers attribute the stability to the state's climate and in-migration.

The latest survey of state real estate trends was conducted in January and found a decline in optimism about commercial real estate. Respondents expect occupancy to fall for office, industrial and retail property -- and rental rates could fall, as well, said Wayne Archer, director of UF's Bergstrom Center for Real Estate Studies. But the guarded outlook on commercial real estate is sunny compared with the residential market.

"It's not that we don't see some lessening of the market, but it's nothing like the sensational doom that dominates the news about residential housing," Archer said.

Archer pointed out that while Florida has a huge number of foreclosures, the numbers vary among the counties. And the state's steady growth should help it weather the real estate downturn.

"There are pessimists who think people are going to pack up and leave Florida, but when I stand outside on these clear winter days, I think 'they're not going far,'" he said. "As long as people keep moving here, the growth will bring us a correction that you won't get in industrial states like Ohio, Michigan or Illinois."

Article Source http://www.bizjournals.com/southflorida/stories/2008/03/17/daily51.html