THE DISCONCERTING PART OF recent real estate statistics is that the value of commercial property is now falling more rapidly than that of residential property.
After dropping by more than 20 percent in 2008, residential property fared much b etter, losing 9 percent of its value last year, according to preliminary figures from Sarasota County Property Appraiser Bill Furst’s office.
But the value of commercial, retail, office and industrial property, which had held steady earlier in the recession, fell by 13 percent in 2009. Vacant industrial land fell by 24 percent last year, rivaling the longtime market leader in bad investments, vacant residential land.
The turn in the numbers is worrisome to Sean Snaith, a University of Central Florida economist.
“It’s like a dismal relay race as the baton gets passed from one sagging sector to the next,” Snaith said. Partly because of the downturn in commercial, Snaith says the real estate recovery may not manifest itself until after 2011.
The figures also bring to mind the oft-quoted findings of a February report by the Congressional Oversight Panel, a group of academics, accountants and former regulators formed to oversee the federal government’s $700 billion bank bailout effort in late 2008.
The panel points out that $1.4 trillion in commercial loans are due to reset over the next four years, and half of them are under water. The foundering of the unwise investments made at the height of the boom is not what worries the panel — it is that a prolonged, deep recession may put sound commercial deals at risk as well.
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