www.reit.com Federal budget cuts will ultimately impact the commercial real estate industry, according to Chris Macke, senior real estate strategist with CoStar Group. Macke sat down with REIT.com to explain the possible impact. He noted that while the federal budget has tripled from 1969 to 2009, federal payrolls have actually shrunk by 30 percent. "So, what that means is that all of those federal dollars went to the private sector. As a result of this, as we cut back federal spending, that means there is going to be a far greater impact on private sector jobs than people realize. It will have a far greater impact on commercial real estate," Macke said. He added that uncertainty looms as to why corporate America has been restrained today when it comes to hiring. While some say it's the result of "anemic demand," others contend it is because of prolific spending on the part of the government, according to Macke. "If it's because of reduced demand, we probably won't see an uptick, because were taking .7 million in spending from many of the corporations' largest customers," he said. Although the exact details of the budget cuts are unknown, Macke said certain parts of the country, such as Washington and Norfolk, Va., with a high exposure to the defense industry may be hit the hardest when it comes to job losses. "There are other markets like San Antonio, San Diego, Baltimore and Tampa that have a high exposure to the defense industry, more than some people realize," he ...

Tags: cmbs market, nareit, real estate fundamentals, federal budget cuts, real estate investment, givernment spending, carisa chappell, reit, economic recovery, commercial real estate, budget defecit, reits, impact on real estate prices, chris macke, costar group

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