Distressed properties continue to offer investment opportunities

Distressed properties may help improve investments.

The commercial real estate market may be plagued with distressed properties for the near future, but this may mean investors have an opportunity to take advantage of inexpensive purchases, subsequently helping strengthen the market, according to a report from Ernst & Young.

The firm says there are approximately $1 trillion in loans estimated to mature within the next five years. In addition, there are approximately $100 billion in these nonperforming loans already in the possession of American financial institutions. This could mean that commercial real estate companies may be able to acquire assets and take advantage of banks looking to sell off loans.

"In 2011, investment activity was at its highest level since we began our survey four years ago, and, according to those who responded, the expectation is that sales volume will remain high in 2012," said Chris Seyfarth, a partner in Ernst & Young's transaction real estate business.

The report added that two thirds of investors think that they will get some amount of financing to make their purchases happen. However, that figure is down from 84 percent two years ago.

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