Slowing Economy and Slumping Demand?

We seem to be hitting a summer lull in Louisville commercial real estate activity.   Louisville seems to be falling in line with the rest of the country as we begin to feel a second slow down in economic activity.   Brokers I am talking with in other parts of the country are reporting similar situations.   One friend from the Pennsylvania area tells me that it was as though someone turned a spigot completely off about 2 weeks ago.   

I am noticing that while I have several deals in the works, that my activity has decreased.   The number of phone calls and e-mails is down and transaction times are increasing.   While these feelings are hard to quantify, a look at some internet statistics seem to back this up.    One of my on-line listing services reported a total of 2,292 hits on the top ten listing for the Louisville area over the last 30 days.   Two months ago, (April 29) this same listing service reported more than 3,100 hits for the top ten listings in the Louisville area.    Although this is not a scientific sample or study, it does give pause to see that the total hits on the top 10 listings is down about one third.   

Also telling is the what people are looking at.   Of the top ten most active listings on this service, 5 were retail properties (cumulatively receiving 1357 hits), 4 were multifamily listings (cumulatively receiving 742 hits) and one was a Hotel / Motel listing receiving 193 hits.     Office, Industrial and Land were absent from the list.

Recent headlines indicate that the economy is slowing again.    Recently, an economist from the St Louis Federal Reserve branch spoke to the Louisville Home Builders Association and reportedly told them that we were in a double dip recession.   

The bottom line is that we remain in a real estate market in correction.   My advice to property owners remains the same.   In a very difficult market, in order to compete, you must be very agressive in marketing your properties.   In pricing and condition of the property, you want to position yourself to be in the top 2% or 3% in order to be successful.

Let me know if you have any questions about this information OR if you have questions about your own property.   I would love to be of assistance.  

Have a great day.

David

David W. McCoy
Associate Broker
Commonwealth Commercial Real Estate
10444 Bluegrass Pkwy
Louisville, KY  40299