Category Archives: Commercial Real Estate

You know, I’m continually amazed at how backwards our commercial real estate agent brethren are.  Oh, don’t get me wrong.  In some ways they are more advanced.  Generally, they are far more professional and actually educated about real estate.  At least their part of real estate.  But in others, it’s just so stupid.

Take a central place to shop for properties, for example.  Residential real estate agents all over the country have access to a local MLS that tells them, almost literally, everything!  Commercial?  It’s like the listings are a mystery to be discovered.  A real challenge to spend your $2,000,000.

Oh, sure, there is LoopNet and CoStar and Xceligent.  And then there are the countless hundreds of poorly SEO’d commercial real estate websites to search through.  But not a single clearinghouse for any given metropolitan area.  Isn’t there somebody, anybody, with the juice to get this done?

Most of our readers here at Kansas City Real Estate & Investing are residential investment property owners…or owners of primary homes.  But I like to keep an eye to commercial real estate as well since my wife and I also own a small business: Portraits Today Studios in Olathe, Kansas.

So when I read stories like this one from today’s Kansas City Star it catches my attention.  It’s a longer article so let me just show you the key paragraphs.

A new study by real estate researchers Reis Inc. found that shopping center vacancies rose in the third quarter to a 17-year high as unemployment climbed, consumers cut spending and stores closed. Vacancies at neighborhood and community shopping centers increased to 10.3 percent — the highest level since 1992 — compared with 8.4 percent in 2008. Vacancies at regional and super-regional malls rose to 8.6 percent from 6.6 percent a year earlier, a high for this decade.

Rents also have dropped, to $39.18 on average at regional and super-regional malls from $40.62 a square foot a year earlier. The 3.5 percent decline is the worst year-over-year deterioration in a decade, Reis said.

“Until we see stabilization and recovery take root in both consumer spending and business spending and hiring, we do not foresee a recovery in the retail sector until late 2012 at the earliest,” Victor Calanog, Reis’ research director, said in a statement.

In my lifetime I cannot ever remember seeing so much empty space in our local shopping centers.  Trying to think back to the recessions of the late ’70s and early ’80s I just don’t think I remember as many shopping centers.  Big companies have fallen in droves and closed up shop.  True to American history, it will be the Mom & Pops that will rebuild the retail sector.  Mark my words.

For those that long to be commercial real estate investors I would have you look at today’s economy.  I think, by far, those that purchased residential rental property on proper fundamentals are weathering this storm in far better shape than the non-corporate commercial investors.