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NEW YORK CITY-While many are reporting a rumored meltdown in the nation's housing market, underlying fundamentals remain relatively strong across most sectors of the commercial real estate industry, according to a recently released PricewaterhouseCoopers 3Q '07 Korpacz Real Estate Investor Survey. “There's no question there has been some negative impact as a result of the problems arising from the subprime residential market downturn,” notes Tim Conlon, PricewaterhouseCoopers' US Real Estate Sector Leader, in the report. “That said, while the volume of investment levels has slowed, the gloom-and-doom scenarios predicted for the commercial real estate market have yet to materialize and the underlying fundamentals continue to be fairly strong.”
Conlon explains to GlobeSt.com that respondents to the survey said that “they have noticed that the tightening of the credit markets has had a broader impact on the economy as a whole, most apparently in the residential sector, but gradually moving over to the commercial side as well. As a result, highly leveraged investors are finding it harder to make deals, compared to all-cash and low-leveraged buyers, because they need to come up with a higher proportion of equity. That, in turn is extending the amount of time it takes to do deals.”
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