Information provided by Carmen Austin, MBA, CCIM, Associate Broker with Saurage Commercial Real Estate.
Despite recent positive trends indicating a turn-around in our local markets, the recently released RERC/CCIM Investment Quarterly 1st Q 2010 Review tells a slightly different story and can best be summarized to say that commercial real estate activity remains weak as a whole from a national perspective. It is a given that until confidence returns on the part of businesses and consumers, we will see little job growth—the critical component needed for commercial real estate usage—and the industry will continue to suffer. In looking ahead, RERC continues to remind investors that the economic recovery will be a slow and steady process, and despite recent positive declines in numbers for unemployment, high unemployment could be with us for the foreseeable future. A decline in unemployment along with growth and recovery in the housing market would be the leading indicators of a turn-around in our industry.
Furthermore, U.S. governmental policy, the federal deficit, and new regulations under the current administration could cause significant potential fiscal instability in the economy for the coming decade. Unfortunately, the U.S. capital markets will remain tight for some time, so keep up your fostered relationships with your local banks. Institutional real estate has already taken many of their lumps, but smaller investors and borrowers present a looming crisis due to the fact that they have not marked-to-market their investments and many regional banks are not able to continue to “extend and pretend.” Cap rate expansion has been priced into commercial real estate prices, but valuations are still catching up. In conclusion, commercial property sale prices are expected to remain flat or decline slightly, although the fear that declining rents could eventually cause further deterioration in prices. To see the full-context of this recently released 2010-1stQ review click HERE.
Carmen has been a practicing commercial real estate broker with Saurage Commercial Real Estate since 2001. She is a graduate of the Louisiana State University (LSU) E.J. Ourso College of Business and the LSU Flores Masters of Business Administration (MBA) Program with a specialization in Entrepreneurship and Real Estate Finance Her experience includes past employment as Regional Director of Leasing at Commercial Properties Realty Trust the for-profit arm of the Baton Rouge Area Foundation. Carmen’s affiliations include Louisiana REALTORS®, Greater Baton Rouge Association of REALTORS® Commercial Investment Division, International Council of Shopping Centers, Commercial Real Estate Women, Certified Commercial Investment Member Institute, National Association of REALTORS®, and Urban Land Institute. She is also an active volunteer on the board of directors for the Baton Rouge Gallery, LSU MBA Alumni Association, Junior Achievement of Baton Rouge, and the Junior League of Baton Rouge.
Saurage Company, Inc dba Saurage Commercial Real Estate was founded in Baton Rouge in 1991 with the purpose of providing exceptional real estate services with an emphasis on commercial property and property management. Saurage Commercial Real Estate offers to its clients a full range of real estate services including brokerage, investment advising, development consulting, REO disposition specialists, asset management, fee based consulting, tenant representation, and buyer representation. The staff of professionals includes combined experience of 50 years, as well as CCIM Designees and Candidates and recipients of Master of Business Administration.
