Ilyce Glink, media entrepreneur and consultant, leads a panel on commercial real estate. (Photo: Chris Prentice)

PHOENIX — Panelists could not agree on commercial real estate’s future in a seminar on “how to tell if the real estate recovery is real in your community” at the Society of American Business Editors and Writers annual conference in Phoenix, Ariz.

“We’re teetering on the brink, and we don’t know which way it’s going,”  panel moderator and real estate columnist Ilyce Glink said afterward.

Glink said the U.S. could enter a “double dip” recession, partially thanks to commercial real estate losses. The country is still losing jobs and tax revenues. If consumers cannot spend, retailers cannot afford their rents, and the recession cycle could start again, according to Glink.

But panel contributors James Woodwell, Senior Director of Research and Business Development at the Mortgage Bankers Association, and Pete Bolton, executive vice president and managing director of Grubb and Ellis’s Phoenix office, tried to emphasize the difference between commercial and residential real estate.

“These are businesses,” said Woodwell.  “We’ve seen dropping values of businesses nationwide.”

Property value for commercial real estate is directly linked to a business’s income, they said.  As retail businesses suffer, so does commercial real estate.

There was no bubble in commercial real estate, Bolton said.

He attributed the decline to investors’ hesitation and made comparisons with what he called the “RTC days” in the 1980s when the federal government created the Resolution Trust Corporation to liquidate insolvent assets during the savings and loan crisis. The current situation just a reaction to other economic issues.

Still, the panelists still could not get past the simple truth: things are bad out there.  “Commercial mortgages are clearly under stress,” Woodwell said.

They also did not know if the commercial real estate market had bottomed out.

Glink concluded with some tips for real estate journalists to make sense of the real estate chaos:

• Keep it local.
• The American Institute of Architects publishes indexes every month.
• Speak with land planner companies and others who do not have a political agenda. Their recovery will indicate overall recovery for commercial real estate.