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WASHINGTON, DC-A newly released annual survey by NAIOP finds growing–albeit still very cautious–optimism in the real estate sector that the capital markets are finally loosening. The survey, called Vital Signs, reported that 44% of the respondents predict that borrowing in 2010 will be somewhat more available with funds chiefly from banks, private investors and insurance companies.

“Obviously the volatile markets of the last year have created great concern for those seeking capital, and the decline in development is the consequence,” says Douglas Howe, NAIOP chairman and president of Touchstone Corp. in Seattle. “While the overall consensus of this survey is somber, there’s hope that most indicators will at least stabilize in 2010.”

Still, though, the credit crisis remains a huge factor for most respondents. In 2008, only 28% felt that borrowing was getting better. In 2009, that number remained basically the same at 29%. In 2009, 64% of respondents felt that borrowing money was the same or somewhat easier than a year ago. Confidence improved for 2010, with 80% of this year’s respondents indicating that borrowing money will remain difficult or become somewhat more available, mainly coming from banks, private investors and insurance companies.Overall investment activity is down 90% compared to a year ago. Besides the constraints in the capital markets, the continued gap of seller and purchaser expectations remains a challenge, the survey found. The most active office product being transacted remains prime, stabilized assets with credit tenants where there is some competition among buyers.

Other findings from the report:

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