Commercial and Residential Lease Prices Expected to Decrease Next Quarter

2/26/2010

Contact                                                                                                        
Kristi Sullivan, 860.571.6213

The Connecticut Economic Resource Center, Inc. recently conducted a statewide survey of real estate brokers and developers to provide a snapshot of market expectations.  The results suggest overall that commercial and industrial pricing has not hit bottom but more transactions are expected this year compared to last. More than 85 percent of respondants are pessimistic about both current and future market conditions for office, industrial, retail and residential real estate.  Other findings include:

• The extension of the residential tax credit signals more positive signs for the residential market over the next three months.
• Since prices overall in the real estate market have dropped considerably over the course of this recession, it is a buyer’s market and the opportunities for investors are improving.  Fifteen percent of the respondents believe that residential sales prices will start to increase in the near-term.
• Transactions are expected to increase somewhat or substantially over the next three months, especially for residential and investment according to 50 percent of respondents.
• Lease prices are expected to continue to decline slightly across all sectors during the next three months. Meanwhile, residential sale prices are expected to increase slightly while other sectors may continue to see decreases.
• Generally, respondents have increased their marketing efforts during the economic downturn, particularly in regard to internet marketing, networking, targeted emails and more creativity with incentives.

“Our survey results confirm what other sources are saying,” noted Alissa DeJonge, Assistant Director of Research at CERC.  “Prices in the residential sector are flattening out, but commercial and industrial markets still have a ways to go in terms of catching up to this trend.”

“CERC believes that surveying our real estate community provides an important, unique perspective to Connecticut’s changing market and is in line with our mission to support the state’s competitiveness,” said Melissa Pasquale, CERC Director of Real Estate.

CERC manages Connecticut’s most comprehensive database of commercial and industrial property and economic data – CERC SiteFinder®. The nationally marketed web site (www.CTSiteFinder.com) has served as a key tool to assist hundreds of developers and brokers in the transaction process, resulting in successful deals helping to grow businesses and jobs in Connecticut for nearly two decades.

About CERC
Based in Rocky Hill, The Connecticut Economic Resource Center, Inc. is a nonprofit corporation and public-private partnership that provides objective research, marketing and economic development services consistent with making Connecticut a more competitive business environment.  Visit www.cerc.com for more info.

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