"The pain is out there for everyone in the short run, but we have seen the last of new office building starts for a long, long time," says Jack Hileman, principal of the Hileman Co. "The inventory and competition is fixed."
 Leventakis |
The rest of 2009 will be rough, Hileman expects, but the market should stabilize by the third to fourth quarter and starting next year, "we should be seeing the return to net new absorption. "The best, newest buildings with solid sponsorship should be well positioned to capture the major relocations," he says. "With zero new product entering the pipeline for the foreseeable future, those with patience and wherewithal will do just fine."
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 Olhasso |
As the CMBS accounted for nearly half of all commercial lending in 2007, and limited financing options are available, Leventakis says cash will be king in 2009, therefore providing opportunities for pension funds, REITS and private investors. "Solving the national debt issue will be the number one catalyst to pump new life in the commercial real estate market."
 Walter |
Olhasso points out that Ontario has plans on the horizon. The Mayor and City Council have embarked on a General Plan Update called The Ontario Plan--a framework that "guides the City's investment for the next 30 to 40 years and creates a 'complete community' where people and businesses want to come and stay."
INDUSTRIALLeventakis says that the Inland Empire's industrial market is well positioned for a comeback when the economy improves because of the area's low-priced housing, ample workforce and desirable location for international shipping. "The developers and owners recognize the changing landscape of the economy and are adjusting rental rates and sale prices accordingly to preserve assets and attract lessees and buyers," he says. "The Inland Empire is Southern California's last stop for companies looking to establish massive distribution centers within reasonable proximity of one of the world's busiest port systems, where more than 40% of all containerized cargo enters the US."
RETAILAs for retail, certain retailers that have borrowed heavily to expand into the market will likely have some contraction, according to Richard Walker, president of Faris Lee Investments. However, in five or 10 years, Walker says that "we will start to see a lot of changes with housing that will positively impact the retail market. Residential values are dropping across the board which will ultimately create a more stable environment for retail. The housing affordability factor needs to be in line with employment in regards to salaries and wages. Once we hit that equilibrium, the Inland Empire retail market will start to grow on a more reasonable basis."
OFFICEOne the office side, "with medical office development on the rise in Orange County, but a lack of available land in the county to accommodate growth, many developers will readjust their focus to the Inland Empire," Leventakis says. He points to the region's more affordable cost-of-living when compared to nearby coastal communities as being a key factor in this readjusted focus.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
