Though the report points out the industrial sector fared better than office and retail, it attributes the performance advantage to a smaller average transaction size, which made debt financing more accessible, rather than the sector's inherently greater strength. In addition, because industrial volumes and values did not experience as large a surge as other sectors during the recent boom, they also didn't suffer as large a fall.
According to the report, debt availability for industrial transactions remains significantly constrained, with banks continuing to tighten loan standards and lending spreads remaining high. The report's authors note that 79% of respondents to the Federal Reserve's January survey of senior loan officers reported tightening standards for commercial real estate lending. Additionally, the survey found that demand for loans remains very weak. Furthermore, the disappearance of the CMBS market has reduced commercial mortgageavailability, with prospects dim for a return of that market for the foreseeable future.
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