.bodytext {float: left; } .floatimg-left-hort { float:left; margin-top:10px; margin-right: 10px; width:300px; clear:left;} .floatimg-left-caption-hort { float:left; margin-bottom:10px; width:300px; margin-right:10px; clear:left;} .floatimg-left-vert { float:left; margin-top:10px; margin-right:15px; width:200px;} .floatimg-left-caption-vert { float:left; margin-right:10px; margin-bottom:10px; font-size: 12px; width:200px;} .floatimg-right-hort { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 300px;} .floatimg-right-caption-hort { float:left; margin-right:10px; margin-bottom:10px; width: 300px; font-size: 12px; } .floatimg-right-vert { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 200px;} .floatimg-right-caption-vert { float:left; margin-right:10px; margin-bottom:10px; width: 200px; font-size: 12px; } .floatimgright-sidebar { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 200px; border-top-style: double; border-top-color: black; border-bottom-style: double; border-bottom-color: black;} .floatimgright-sidebar p { line-height: 115%; text-indent: 10px; } .floatimgright-sidebar h4 { font-variant:small-caps; } .pullquote { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 150px; background: url(http://www.dmbusinessdaily.com/DAILY/editorial/extras/closequote.gif) no-repeat bottom right !important ; line-height: 150%; font-size: 125%; border-top: 1px solid; border-bottom: 1px solid;} .floatvidleft { float:left; margin-bottom:10px; width:325px; margin-right:10px; clear:left;} .floatvidright { float:right; margin-bottom:10px; width:325px; margin-right:10px; clear:left;} tr.d0 td { background-color: #ccccff; color: black; }
“The days of easy money are over,” broker Linda Gibbs told a gathering of Central Iowa real estate insiders and business people last week. “In 2008, cash is definitely king.”

More than 300 people attended the CB Richard Ellis/Hubbell Commercial annual market survey luncheon at the Hy-Vee Conference Center in West Des Moines. They heard Hubbell Managing Director Kyle Gamble say the crucial question facing the real estate industry is “whether the financial and credit markets can get back on track by midyear.”

As one of several Hubbell brokers to address the group, Gibbs noted that when it comes to investment properties, “many TIC (tenants in common) players have left the field.”

However, she assured the audience that a lot of money is still coming into the marketplace, plenty of lenders are available and “the investors that are left are focused on real estate fundamentals, not just buying because they can.”

In 45 minutes, the presenters distilled the results from the 11th annual Greater Des Moines Real Estate Market Survey, which was conducted for CB Richard Ellis/Hubbell Commercial by Frandson & Associates L.C., a Des Moines-based appraisal and consulting firm, and the 38th annual Metro Des Moines Apartment Survey, prepared by Carlson, McClure & Associates Inc., an appraisal and consulting firm also based in Des Moines.

Here’s a summary of the highlights:

Multi-unit housing: The conversion of some downtown condominium projects to rental apartment units will affect the central business district vacancy rate, which is now at 4.7 percent, according to broker Tom DeWaay. “Overall, vacancy rates for the Greater Des Moines apartment market have increased slightly to 8.5 percent from 8.1 percent,” he said.

The South Side, which has one-fifth of the apartment units in Greater Des Moines, also has the weakest occupancy statistics in the marketplace, with 12.6 percent of its units vacant.

Office: New construction of speculative office space in Greater Des Moines totaled 167,500 square feet in 2007, a three-year low. “The expanding owner-occupied building market has outpaced the competitive market in regards to square-footage growth in recent years,” broker Heath Bullock said. “Corporate owner-occupied office buildings make up approximately 48 percent of the total market. This trend will continue to impact occupancy rates in the central business district and West Des Moines over the next 36 months.”

The Des Moines market now has 25.9 million square feet of office space.

Bullock noted that downtown is projected to have as much as 900,000 square feet standing vacant in 2010, or more than 20 percent of its 4.1 million square feet.

Industrial: Only 230,000 square feet of warehouse space were absorbed in the Central Iowa market last year, broker Bob Stewart reported. About 1.5 million square feet were absorbed in each of the previous two years.

Stewart said the manufacturing sector rebounded strongly in 2007 after two lackluster years, and occupancy now stands at 97 percent.

Retail: Greater Des Moines’ retail market expanded by 484,000 square feet in 2007, according to broker Colleen Johnson. Sixteen new neighborhood and community retail centers were added, and Jordan Creek Town Center’s occupancy reached 98.5 percent in its third year of operation.

However, retail sales in the Des Moines metropolitan statistical area increased just 1.1 percent last year, far below the level seen in recent years.

Investment properties: The recent strong activity in this sector continued through the first three quarters of 2007, Gibbs said, but the nation’s economic problems stopped that trend. “The year ended in near panic,” she said.

For the year, Polk County transactions over $500,000 totaled $337 million, a decrease of 8.5 percent compared with 2006. Gibbs said a large bid gap has developed between buyers and sellers.

Tim Sharpe, Gibbs’ husband and sales partner, said, “Risk is being priced back into the market, which is a good thing.

“The recent real estate slowdown is a return to normalcy, rather than a deviation from the norm,” he said. “2008 will be a year of uncertainty but also a year of opportunity.”