The amount of distressed commercial real estate in Southern Nevada increased slightly in the third quarter of 2011, reports Colliers International Las Vegas. “We are now tracking 14.6 million square feet of distressed industrial, office and retail in Southern Nevada, up from 14.5 million square feet in the second quarter of 2011, and up from 13.3 million square feet in the third quarter of 2010,” said Colliers researcher John Stater.Approximately 35 percent of this space is office product, 33 percent retail and 32 percent industrial. The largest quarter-over-quarter increase of distressed space was in industrial space, which increased by 3.9 percent to 4.7 million square feet. Office distressed inventory decreased by 0.2 percent to 5.1 million square feet.
The news isn’t all bad, however. Investment sales in Southern Nevada are much stronger in 2011 than in the past few years, a sure indication that investors outside Southern Nevada are becoming more confident in the area’s economic future.
“Despite four years of recession, Southern Nevada’s growth over the past ten years is still impressive, with cap rates now floating between 7 and 8 percent,” Stater said. “Rates should head into the mid 6’s and low 7’s, as the amount of capital chasing deals in the market increases. Private equity investors are looking at tertiary markets like Southern Nevada, having been chased out of the first and second tier markets by larger entities.”
For Colliers 3rd Quarter report, CLICK HERE
