by Jed Smith
 
Commercial real estate in the U.S. encompasses a wide diversity of building types and sizes. Recent problems with declining commercial space, sales and prices, stagnant and declining rents, troubled assets, and financing illiquidity began with the onset of the Great Recession. The market performance of the sector tends to lag the economy in general, with sector stabilization and initial recovery projected for 2011.

Market Size, Drivers and Demand
The overall amount of commercial space available in the U.S. is estimated at 78.8 billion square feet located in 5.3 million buildings. This is the latest data from the Energy Information Administration.  In addition, there are an estimated 15.3 million apartment units in buildings with 10 or more apartments.

Building sizes vary widely. There are an estimated 9,000 buildings that are larger than 500,000 square feet, and 3.8 million buildings with less than 10,000 square feet-of which 2.8 million are less than 5,000 square feet in size.

The major economic drivers for space demand are changes in employment and economic growth (GDP). Both drivers were negatively affected by the Great Recession, and recovery has been slow.
• The dollar sales volume for core commercial space (office, retail, apartments, and industrial) declined to $52 billion in 2009 after reaching a high of $428 billion in 2007. The good news is that in 2010 there has been a slight uptick in commercial demand, with an estimate approaching $70 billion in 2010.
• Commercial leasing demand has declined for most property types over the past two years. Multifamily has been the only resilient property type to weather the economic recession, with that segment of the commercial market registering positive net absorption. However, rents have declined across the board.
• Commercial real estate prices have also declined from their peak. Currently both rental and sales prices for Class A office building space are recovering, but the recovery of the rest of the market has been somewhat slower. Commercial Real Estate Overview.