WASHINGTON, DC-At long last, it is here: the bottom of what has been the worst real estate and capital market cycle in anyone’s recent memory. So says National Association of Realtors’ commercial economist George Ratiu. “There are multiple indicators suggesting that, on the commercial real estate side at least, we have hit bottom,” he tells GlobeSt.com. The most recent indicator was the upwardly revised GDP figures, now at 2.5%.

Granted, this is not a growth rate “to write home about” Ratiu says, but it adds to the growing pile of evidence that a recovery is underway. When the GDP figures were released, NAR bumped up its own projections for the industry, he says. 

Another measure the association closely watches is investment sales. This year it is predicting that some $100 billion in transactions will have closed, compared to the $54 billion in 2009 and the $145 billion in 2008. “Demand is slowly turning around after having been negative for the last two years or in some cases, three years,” Ratiu says. In some asset classes, such as office, it will remain negative for at least one or two quarters more. Others, especially multifamily, are showing positive growth already.

According to NAR’s latest Commercial Real Estate Outlook, which used historical data from CBRE Econometric Advisors: 

Vacancy rates in the office sector are forecast to decline from 16.7% in the current quarter to 16.4% in the fourth quarter of 2011, but with very little change during in the first half of the year. Annual office rent is expected to decline 1.8% this year, and then slip another 1.6% in 2011. 

Industrial vacancy rates are projected to decline from 13.9% currently to 13.2% in the closing quarter of 2011. Annual industrial rent is likely to fall 4.0% this year, and decline another 3.4% in 2011. 

Retail vacancy rates are expected to change little, declining from 13.1% in the fourth quarter of this year to 13% in the fourth quarter of 2011. Average retail rent is seen to drop 3.4% in 2010 but largely stabilize next year, slipping 0.3% in 2011. 

Multifamily vacancy rates are forecast to decline from 6.4% in the current quarter to 5.8% in the fourth quarter of 2011. Average apartment rent is likely to rise 0.2% this year and another 1.4% in 2011.