Morning Brief: A Look at Commercial Real Estate
We focus exclusively on local business on Mondays and this week we took a look at one of the region's key industries: commercial real estate.
We found that the slowdown in consumer spending and the credit crunch have put the brakes on retail projects throughout the region. Developers here and across the country are postponing, scaling back and even canceling their plans.
Meanwhile leasing of commercial office space in the Washington area had its biggest quarterly drop in more than a year as financial markets slid into crisis and economists predicted a deep national recession.
Many of the deals that did get done in the third quarter came from businesses renewing current space rather than expanding into new buildings. Many brokers and analysts predicted that the market will continue to be slow as long as concerns over the future of the economy exist.
Take a closer look at some of the metro area's statistics here.
We also found some silver linings. All of the work associated with the Treasury Department's bailout of the financial system could give the local real estate market a shot in the arm.
Between 2 million and 4 million square feet of office space could be gobbled up over the next three years as new regulatory agencies take shape and as lobby shops, accounting firms, consultants and asset managers position themselves to take advantage of government intervention efforts.
Several major real estate firms, including Jones Lang LaSalle and CB Richard Ellis, said they've been contacted by Treasury Department officials to help look for more office space to lease close to the department's headquarters on Pennsylvania Avenue.
And finally Tom Heath talked to Michael Glosserman, managing member of JBG Holding, and other dealmakers in the Washington area and found that some are looking to capitalize on potential steals next year.
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