Survey: Split decision on commercial real estate recovery timing

San Francisco Commercial real estate investors, brokers and owners have mixed perspectives on the market’s near-term future, according to the First Quarter 2010 LoopNet Pulse Poll. LoopNet operates the largest online commercial real estate marketplace with four million members.

Just under half of LoopNet members expect a recovery in transaction volumes in 2010, while a substantial number expect recovery to wait until 2012.

About 45% believe that year-over-year growth in transaction volume will resume by the end of 2010 (including a small number that believe it has already begun). Meanwhile, a substantial 20% are expecting growth to be delayed until 2012 or later. With 35% predicting a 2011 recovery, this nets out to a majority of 55% who are not expecting a recovery this year.

Consistent with its Fourth Quarter 2009 LoopNet Pulse Poll, access to debt financing remains the most significant obstacle to completing transactions, indicated by half (49%) of survey respondents as the top reason, followed by high asking prices (25%) and insufficient equity capital among buyers (18%).

While debt financing was the top choice for all three groups, the relative weighting varied by role. For brokers and owners, lack of access to debt financing was over twice as important as asking prices in explaining the dearth of transactions, while investors rated pricing as almost equally important.