CRE Sentiment Clear: Seller Confidence Way Up

U.S. commercial real estate sellers and buyers are poised for activity, according to findings from Colliers International’s Q3 2010 Global Investor Sentiment Survey. More than six out of 10 real estate investors responding to the quarterly survey conducted by the international commercial real estate firm indicated that they are considering selling property over the next year--up considerably from the 23 percent reported in the real estate firm’s Q1 survey.

Meanwhile, 85 percent of investors expressed a desire to buy assets domestically during that time, with a focus on primary markets nationwide. And, the combined forces may position a significantly increased number of U.S. assets to trade over the next 12 months. Markets in California; Texas; New York/New Jersey; Florida; Washington, D.C.; Boston; Atlanta; Chicago; Denver; and Seattle were noted as key targets by respondents.

The study also revealed that 60 percent of the investors polled expect to expand their portfolios in the coming year. An additional three out of 10 expect to maintain the size of their portfolios, with some of those expressing an interest in rebalancing them among different asset classes.

The survey, which included international investors, determined that the majority of U.S. respondents still believe that the commercial real estate market is at the bottom of the cycle, similar to the sentiment in the first quarter of 2010.

“With the market at the bottom of the cycle, it’s no wonder why so many investors are seeking to expand their portfolios in the coming year,” said Dylan Taylor, chief executive officer of Colliers International in the United States. “Investors recognize that prices are at the bottom and see tremendous value in commercial real estate,” he pointed out. Taylor also noted that this kind of positive sentiment expressed by U.S. investors has often been a precursor to a more active investment sales market.