Nearly 80% of commercial real estate executives questioned said they did not believe that the meltdown of financial powerhouses and the resulting bail out by the federal government signaled the end of the crisis.
And 60% said they believed that the current credit crisis eclipsed the Savings & Loan crisis of 1989-1991 as having the greatest impact on the state of the industry.
The survey, by law firm DLA Piper which questioned 424 professionals, makes gloomy reading. Some 90% of respondents described themselves as having a bearish outlook for the next 12 months; up from 68% questioned a year ago when the credit crunch began.
'We seem to running in place at best, and at worst, we're in some sort of a free fall,' said Jay Epstien, chairman of the US real estate practice for the law firm.
However half those who said they were bullish believed they could find good opportunities resulting from distressed properties and loans.
The commercial property market in the US has come to a near halt since the credit markets became unhinged and sources of financing dried up. One of the cheapest and most often-used sources of debt that helped drive the commercial real estate boom was the commercial mortgage-backed securities (CMBS).
Last year, the CMBS market accounted for $230 billion worth of securitized commercial mortgages, according to the Commercial Mortgage Securities Association. This year the total fell to $12 billion, and there have been no new issuances since June.
About 46% of the respondents said they did not believe securitized lending transactions financed by the CMBS market would return to prior levels until after 2010. About 33% said that it would return by 2010, and 16% said they did not think CMBS would ever return to its prior strength.