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CT Commercial Real Estate Conditions Improve Modestly in Fourth Quarter Survey


The latest quarterly survey on Connecticut real estate conditions, conducted jointly by the Connecticut Business & Industry Association (CBIA), the Connecticut Economic Resource Center (CERC), and DataCore Partners LLC, shows that overall commercial real estate activity strengthened a bit in the fourth quarter of 2011.  The combination of a better than expected holiday shopping season thus far, modest job growth, and a tempered rebound in regional consumer confidence measures have all contributed to slightly better overall commercial real estate readings. As a result, many of the key readings on office, retail, industrial, and investment real estate activity around the state are up relative to third quarter readings.

“This improvement in the fourth quarter, while not robust, is still a move in the right direction and reflects an overall trend towards stronger growth as the year has progressed,” said Don Klepper-Smith, chief economist and director of research at DataCore Partners.

“One piece of good news can be found with data on current conditions within the Connecticut commercial market, which are some of the highest readings since our data was first tracked in mid-2010,” reflected Peter Gioia, vice president and economist at CBIA.

According to the latest CT COMpREhensive survey results, the Farmington Bank/ODMD Commercial Real Estate Index rose to a level of 13.7 in the fourth quarter, up modestly from the reading of 9.7 in the third quarter, and roughly on par with the figure of 13.8 in the second quarter.  The Current Conditions Index component was recorded at 13.7 in the fourth quarter, the best reading in six quarters of data thus far, also besting the figure of 9.1 in the third quarter. The Future Expectations Index component also improved, rising to an index level of 12.6, up from 10.3 in the third quarter.

“The staying power of the current economic expansion appears to be less of an issue, prompting many local economists to state that the odds of a so-called “double-dip” recession have diminished as a result,” said Alissa DeJonge, director of research at CERC. 

“The current consensus is that economic recovery is finally starting to strengthen as many consumer measures have improved since this past summer,” stated Bruce Blasnik, Partner at ODMD.

“Importantly, the primary generators of consumer wealth – stocks, jobs, and housing – have all displayed varying signs of improvement,” added John Patrick, President & CEO of Farmington Bank.

The Connecticut job recovery rate, defined as jobs gained back expressed as a percentage of jobs lost, now stands at 28.6% as of October, higher than the national recovery rate of 25.9%.

Other findings include:

  • Respondents were slightly pessimistic with respect to the near-term outlook for the Connecticut economy over the next three months.
  • Fundamentals surrounding the Connecticut Office Market continued to be affected by near-term activity in the local labor markets. Only 6% of the respondents polled characterized current conditions as “good” or “excellent,” while 52% stated that conditions were “fair.”
  • The state’s Industrial Market has been buoyed by healthy export growth, which has risen about 7% on a YTD basis. Only 6% of the respondents polled characterized current conditions as “good” or “excellent,” while 55% stated that conditions were “fair.”
  • The environment for Connecticut Investment Market appears to be more favorable as the overall economy improves and profit margins remain healthy.  As was the case last quarter, investment real estate once again saw the most favorable readings on “present situation” and “future expectations.”  About 27% of the respondents polled characterized current conditions as “good” or “excellent,” while 49% stated that conditions were “fair.”
  • Connecticut’s Retail Market has seen modest improvement in recent months, helped in part by a holiday shopping season that got off to a good start with a 7% sales gain relative to last year. Only 16% of the respondents polled characterized current retail market conditions as “good” or “excellent,” while 53% stated that conditions were “fair.”
  • The health of Connecticut’s Residential Market has clearly been impacted by conditions within the local labor markets, as well as record-low interest rates. About 11% of the respondents characterized current residential real estate conditions as “good” or “excellent,” while 50% stated that conditions were “fair.”

The latest survey was conducted during the October-November-December timeframe and polled real estate professionals in all eight Connecticut counties, asking for opinions and perspective regarding local real estate conditions in both the residential and commercial markets. There were a total of 112 respondents who participated in the most recent survey, and included real estate brokers, real estate developers, bankers, appraisers, and economic development officials from around the state.

The executive summary of this quarter’s CT COMpREhensive and Farmington Bank/ODMD Index is available here and on

About the Farmington Bank/ODMD Commercial Real Estate Index
The Farmington Bank/ODMD Commercial Real Estate Index is a diffusion index measuring the health of Connecticut’s commercial real estate market, assessing conditions within four key commercial real estate sectors: office, industrial, retail, and investment. The index is sponsored by both Farmington Bank of Farmington, and O’Connor Davies Munns & Dobbins LLP of Stamford.

About CBIA
CBIA is Connecticut’s largest business organization, with 10,000 member companies. For more information, please contact Ann Marie C. Raymond (860.244.1957; or visit

About CERC
The Connecticut Economic Resource Center, Inc. is a nonprofit corporation and public-private partnership that provides objective research, marketing and economic development resources consistent with making Connecticut a more competitive business environment.  For more information, visit and connect to CERC on FaceBook, LinkedIn and Twitter (@cercinc).

About DataCore Partners, LLC
DataCore Partners, LLC is a New Haven-based research firm headed by chief economist and director of research Don Klepper-Smith.


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