Realtors Expect Lower Vacancy Rates in All CRE Categories.(forecasts and trends of vacancy rates )

Washington -- Vacancy rates in all the four major commercial property types are likely to decline this year as the commercial real estate market improves, according to the National Association of Realtors.

David Lereah, the association's chief economist, expects that commercial real estate vacancy rates will continue to move down over the next two years.

There was a 53% increase in commercial real estate-related transaction volume last year, in comparison to volume for 2003, the NAR reports, with multifamily and office properties seeing the biggest gains.

Considering the major property sectors, commercial real estate investment totaled $181.4 billion for 2004, compared with $118.8 billion for 2003, not taking into account transactions under $5 million, the NAR reports.

Foreign investors spent over $12 billion on U.S. commercial real estate last year, 75% of which was on office property.

Real estate investment trusts focused their efforts on the retail sector, accounting for about 14% of transaction volume in this sector.

Al Mansell, CEO, Coldwell Banker Residential Brokerage, Salt Lake City, and NAR president, noted, "Even with healthy economic growth over the last couple years, job creation really didn't pick up until 2004. Those jobs have fueled the need for commercial space, so the market is on solid ground and is experiencing a growing demand."