"This optimism by investors says more about the future of the commercial real estate sector than anything else," NAR chief economist David Lereah says. "The investment level shows they understand the value of portfolio diversification and the fundamental demand for commercial real estate that occurs in a growing economy."

NAR reports that investment in the industry for the remainder of the year will continue to be spurred by projected economic and employment growth, a decrease in oil prices and fortified business spending. Declining vacancy rates across the board also indicate a positive future for commercial real estate.

In the office market, the vacancy rate in the aforementioned metropolitan areas dropped from 16.6% in 2003 to a projected 16.3% this year, and is expected to drop to 15% in 2005. The retail vacancy rate will remain stable at just over 8%, and the industrial sector rate, calculated to be 11.7% for 2004, will decrease to 11.4 in 2005. As for the multifamily market, vacancies will go from an expected 6.2% this year to 6% in 2005.