Commercial Realty: Market Bright Spot

American Banker (10/10/08) P. 13; Berry, Kate
According to Advantus Capital Management Inc.'s third-quarter economic update, commercial real estate remains one of the stock market's better-performing sectors. The Minnesota-based investment adviser's relatively bullish view of commercial property was based on a 4.5-percent increase in the Dow Jones Wilshire Real Estate Securities Index, which outperformed the Standard & Poor's 500 Index in the third quarter this year. Advantus noted in its report that commercial real estate funding typically is long term, "insulating it from current stresses in short-term credit." Although the fundamentals of the commercial sector are currently "solid," a braking economy would likely put pressure on certain properties, like hotels, where income is not derived from leases and other longer-term instruments.