Commercial Real Estate Will Slow, Not Tank

Malls, offices won't be hit nearly as hard as housing, experts say
By Jim O'Neill,  Newser User
Posted Mar 10, 2008 9:18 AM CDT
Although the commercial real estate market has slowed, experts say it will slump less than the housing market has.   (Associated Press)
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(Newser) – The commercial real estate market has slowed dramatically, but won’t rival the housing implosion, reports the Wall Street Journal. Prices will likely fall just 20%, compared with 40%-plus for homes in some markets, and commercial property owners—unlike record numbers of homeowners facing foreclosure—have largely been able to keep mortgages current.

Still, commercial sales have slowed to a crawl as credit markets continue to tighten and development has all but stopped. The market has not had to contend with huge surplus—as it had during its disastrous run in the early 1990s—but experts warn it could quickly deteriorate if the economy falls into an extended recession.