SIOR Index hits bottom

After 11 consecutive quarters of decline, the Fourth Quarter 2009 SIOR Commercial Real Estate Index, gained 0.2 percent to 35.5 points.
100 points signifies a balanced market. The U.S. commercial real estate market has not been balanced since the third quarter of 2007, according to the SIOR Index, which is compiled by the Society of Industrial and Office Realtors (SIOR) in association with the National Association of Realtors (NAR).
The Midwest SIOR fourth quarter index was 36.3 point, unchanged from the third quarter. The west index was the lowest at 27.1 points, the south index was at 37.8 points and the northeast index was 43.7 points.
“The Milwaukee market has remained much more stable largely because of its lack of speculative development compared to other cities in the Midwest,” a SIOR press release said.
Optimism is rising among SIOR members as 55 percent expect the commercial real estate market to improve during the first quarter of 2010.
Commercial real estate development across the country is extremely low, SIOR members report as 98 percent of them say development was “down,” and 87 percent said it is virtually nonexistent in their markets.
The commercial real estate market remains a tenant’s market across the country as 97 percent of SIOR members report either deep discounts to asking rents or moderate levels of tenant concessions. Only 3 percent of SIOR members say they are experiencing a “normal” negotiating balance.