Dotzour was speaking to an audience of 700 at the Real Estate Investment Securities Association's Annual Conference.
"This move from the historic low cap rates of 2006 and 2007 back to 2002 levels means that commercial property values are likely to be 30 percent to 45 percent below the values at the peak of the market in mid 2007," he said.
He said overall price declines will vary from city to city, with the biggest overall declines in the nation's largest cities.
“The bidding frenzy for commercial real estate was hottest in the largest metro areas, which traditionally attract bidders from all over the world," he said. "Smaller cities, such as Amarillo and Lubbock, never saw the same bidding pressures. Consequently prices never spiked and, consequently, they won’t have as far to fall.”
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