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Special Reports
Commercial Lending
National Association of Realtors Creating Commercial Market Indicator
By Poonkulali Thangavelu
SAN FRANCISCO -- The National Association of Realtors introduced plans for a new
commercial real estate market index at its annual convention here, which it expects to roll out sometime this year.
David Lereah, NAR's chief economist, said that this indicator will incorporate
data from various other indicators that affect commercial real estate activity.
He noted, "Modeling a relationship between economic and commercial market
indicators, as well as market trends and sentiment, will provide us with a new tool in assessing market behavior
in the major commercial real estate sectors. It is being designed as an index to provide early signals of turning
points between expansions and slowdowns in commercial real estate activity."
NAR is looking at a number of indicators that could affect commercial real estate
activity, studying the relationship of these indicators and modeling a commercial real estate indicator based on
historic trends.
"Up to now, commercial decision makers have relied on recent hard data and
assumptions about future direction," James Marelli, the NAR's vice president of commercial real estate, said.
The new indicator will use "a full spectrum of critically important information
to provide better guidance on where the commercial real estate markets are headed, and to aid market makers in
developing strategies for the future."
The input used to build the commercial real estate indicator could move in different
directions, but together, they are expected to offer a better indication of future market activity. More than 100,000
NAR members participate in the commercial sector.
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