.floatimg-left-hort { float: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;} A report released last week by CB Richard Ellis/Hubbell Commercial (CBRE) indicates that weak demand and limited credit continue to plague metro area developers, landlords and brokers.

The 2010 Greater Des Moines Real Estate Market Survey was prepared by Frandson & Associates LC, a commercial real estate appraisal and consulting firm.

“With the exception of a few major projects … and the pending impact of the delivery of the Aviva USA and Wellmark (Blue Cross and Blue Shield) buildings, the office market stagnated this past year,” said Heath Bullock, a CBRE vice president.

In 2010, the relocations of Wellmark and Aviva to owner-occupied corporate campuses downtown and West Des Moines, respectively, are expected to dump nearly 1 million square feet of office space onto the market.

And though Greater Des Moines continues to outperform the national vacanccy rate of 17.5 percent, the metro area’s current office vacancy rate of 11.1 percent could skyrocket, in lieu of a quick recovery.

In 2009, only 363,482 square feet of new office space were added in the metro, compared to more than 1 millon square feet in the previous 12 months.

Also in 2009, the market saw only 150,827 square feet of positive absorption, and CBRE expects occupancy levels in the competitive office market to decline into 2011.

In the retail market, the state of consumer confidence continues to affect outcomes.

“A lack of consumer confidence combined with significant supply of neighborhood and community centers has resulted in the highest vacancy levels in the 13 years of tracking this specific market category,” said Colleen Johnson, a CBRE vice president.

The big-box retail sector showed strong performance over the past 12 months and ended the year with a 95.1 percent occupancy rate.

But the neighborhood and community center category, which includes multi-tenant buildings with small to medium-sized occupants, is facing a 24.7 percent vacancy rate, compared with 17.9 percent in 2007.

Of the 58,479 square feet of new retail development in 2009, all of it occurred in the Western Suburbs and Northeast Des Moines submarkets.

“The trend for more cautious consumer spending will likely continue with new construction occurring only in select markets,” Frandson & Associates reported.

Overall retail sales in Greater Des Moines fell nearly 6 percent in 2009 from the prior year.

The local industrial market was essentially unchanged in the past 12 months, said Bob Stewart, a CBRE senior broker associate.

Warehouse and manufacturing vacancy rates are remaining steady at 8.8 percent and 4.6 percent, respectively.

“Developers are not adding new product to the market, and occupiers are holding steady on their real estate positions,” Stewart said.

On the investment property front, Tim Sharpe, a CBRE senior vice president, said that “2009 will be remembered and studied for some time to come as one of the most challenging economic periods in modern history.”

But Sharpe’s partner, CBRE Senior Vice President Linda Gibbs, noted that Midwestern tertiary markets are faring better than the rest of the country.

“For every property type, the final quarter of 2009 marked an upturn,” Gibbs said. “The direction clearly is more positive than one year ago, when the bottom was nowhere in sight.”

In Greater Des Moines, sales transactions for all investment property types exceeding $500,000 declined 15 percent, from $192 million in 2008 to $163 million in 2009.

However, overall transaction activity in the investment property sector edged up in the third quarter of 2009, as U.S. property sales posted a quarterly increase for the first time in two years. That was followed by another gain in the fourth quarter.

“Although the industry and the overall economy still face an array of hurdles, and no one seems to be giddy with optimism,” Sharpe said, “the industry is starting 2010 with more clarity and a lot less fear” than last year at this time.