Commercial-real-estate market registers positive changes

The Phoenix-area commercial-real-estate market passed a significant milestone in the fourth quarter, but you won't find evidence of it by looking at statistics. That's because the positive changes were psychological, rather than economic, property investors and brokers said. About three years after the area's commercial-real-estate market followed housing down the drain, a large number of struggling property owners who had been holding out for a miracle recovery finally began to accept the truth, investor Steven Jaffe and others said. At the same time, a number of real-estate investment firms that had been hanging onto cash in anticipation of a desperation-fueled commercial-property giveaway finally realized it wasn't going to happen. "The panic was gone, and the blind optimism that everything was going to turn around was gone," said Jaffe, executive vice president and general counsel for BH Properties LLC, a Los Angeles-based real-estate investment firm. BH Properties recently acquired the 320-unit Fiesta Park apartment complex, 1033 S. Longmore, in Mesa, for $5.5 million. It was the company's first purchase in the Phoenix in nearly three years, he said.

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