Real Estate OutlookDeloitte Financial Advisory Services LLP |
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Although there are indications the economy is improving, most executives are pessimistic about the outlook for the commercial real estate market in 2010. While many expect commercial property values and rents to continue to decline over the near term, some companies see this as an opportunity to buy properties at bargain prices.
Deloitte Financial Advisory Services LLP’s (Deloitte FAS’) Real Estate Outlook found that roughly three-quarters of executives expect both commercial property values (76 percent) and asking rents (73 percent) to continue to fall in 2010, according to a recent online survey of more than 325 executives. In fact, roughly two-thirds (63 percent) of executives predict that a full recovery of the market will require two to three years, while 29 percent believe it will take four years or longer. Only 8 percent anticipate a full recovery within the next year.
Since a full recovery is expected to take time, executives continue to look for opportunities to cut costs. Deloitte FAS’ 2010 lease administration benchmarking survey found that roughly two thirds of tenants that conducted lease audits* said that the audits had resulted in cost reductions, while about half of the owners who conducted lease reviews said lease audits had resulted in increased expense recovery.
To gain insights into the commercial real estate market, download Deloitte FAS’ Real Estate Outlook below. Additionally, to learn more about how executives effectively manage lease portfolios, download the 2010 lease administration benchmarking survey.
*The term "audit" as used herein is not and should not in any way be construed to be synonymous with the terms "audit," "audit procedures," "compilation," "review" or any form of "attestation" service as described in the pronouncements on professional standards issued by the American Institute of Certified Public Accountants.
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Deloitte’s Real Estate Outlook
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