Article by Adam Eventov
A prolonged war in Iraq could affect the juggernaut that is the Inland Empire commercial real estate market, according to Stuart Gabriel, director of the USC Lusk Center for Real Estatecolor>.
If history repeats itself, an impending war will undermine consumer confidence as it did before the Gulf War. Since much of the economy relies on consumer spending, falling consumer confidence could help send the economy into a prolonged recession, Gabriel said.
While the office market remains strong in San Bernardino and Riverside counties, vacancies have risen nationwide. A war would likely drive vacancies up and lease rates down, Gabriel said.
The industrial market, which was down in 2002 from the highs of 2000, could slow further as companies wait until international situation settles and the country's economy recovers, Gabriel said.
"Right now, there's a lot of money on the sidelines," he said. "Investors are nervous."