Indeed, the severe credit crunch is the key driver behind the dismal results in the latest NAR Commercial Leading Indicator for Brokerage Activity. It fell 4.8% to an index of 103.5 in Q1, from a downwardly revised reading of 108.7 in Q4. It is now 12.9% below the 118.8 recorded in the first quarter of 2008. Because it is a forward-looking metric, the index points to a decline in net absorption and completion of new commercial buildings over the next six to nine months.

Office vacancy rates are projected to increase to 16.1% in 2009 from 13.4% last year, and rise to 20.4% in 2010. Annual rent is forecast to fall 7.2% this year and 0.8% in 2010 after a 0.4% decline last year.

Vacancy rates in the industrial sector are estimated to rise to 11.9% in 2009 and 12.6% next year, compared with 10.4% in 2008. Annual rent is likely to fall 3.4% this year and 4% in 2010, after declining 0.8% in 2008.

The retail vacancy rate will probably rise to 12.1% this year, NAR goes on to report, and 15.8% in 2010 from 9.7% in 2008. Average retail rent is expected to fall 2.1% in 2009 and 1.5% next year; it declined 2% in 2008.

Finally, multifamily vacancy rates are forecast to rise to 6.8% in 2009 and 6.7% next year from 5.7% in 2008. Average rent should grow 1.5% this year and 2.5% in 2010, following a 2.9% gain in 2008.

The SIOR Commercial Real Estate Index, a separate attitudinal survey of more than 600 local market experts, also point to a lower level of business activity in upcoming quarters. The SIOR index has declined for nine straight quarters and stood at 42.3 in the first quarter, well below the 100 point criteria that represents a balanced marketplace.

Then there is the Architecture Billings Index, which after an eight-point jump in March, fell less than a full point in April. A leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lag time between architecture billings and construction spending.

In April the ABI rating was 42.8, down from the 43.7 mark in March. This was the first time since August and September 2008 that the index was above 40 for consecutive months; still, though, any score under 50 represents an overall decline in demand for design services.

More good news: the new projects inquiry score was 56.8--the second month with very strong inquiries for new projects. A growing number of architecture firms report potential projects arising from federal stimulus funds, says AIA Chief Economist Kermit Baker in a prepared statement. What these figures mean is that we could be seeing things turn around over a period of several months, he concludes.