Quick Survey: State Governments, Not Fed, Hardest on Real Estate Industry

NEW YORK CITY-When is the Fed toughest on commercial real estate? When it comes to environmental issues. That is the consensus of more than half–52%–of respondents to GlobeSt.com’s latest Quick Survey.

After years of hearing from real estate experts how the Fed puts the squeeze on the industry in down times, we decided to put the theory to the test and surveyed visitors to the site on the question. Interestingly, the jury was split on whether or not Capitol Hill was tougher on CRE than on other industries, with 50% voting yes and 50% voting no.

But that’s not to say that the Fed has been any “kinder” to real estate players during the current downturn. While 74% say the government has not cut the industry any breaks, only 26% see a gentler attitude toward real estate.

Respondents, invited to expound on their votes, seem to think that DC just doesn’t get it. As one writer explains: “I don’t think government, whether Federal, state, or local, understands the economic impact of its land use legislation. This may be because few elected officials come from business backgrounds.”

Another contributor says it comes down to a matter of need. “If the Federal government needs to start borrowing money again,” he says, “it will not help the real estate industry. This tax cut is already a fiasco.”While environmental issues were the top sore point in real estate’s relationship with Big Government, taxation came in second with 42% of the vote. Interstate property ownership and telecom provider access each garnered 3% of the vote.

“Capital gains and depreciation-recapture are excessive,” writes one respondent. “Environmental limitations are also excessive, on all levels of government.”

“Double taxation is what keeps the lid on many transactions, by taxing the gain and then taxing the income,” writes another participant.