The commercial real estate market hasn’t been in the crosshairs of the residential real estate in the past. While, for the past four to five years, the housing market erupted to excessive proportion, the commercial real estate cousin fared well. However, unlike residential real estate, the commercial market has not been affected by various factors that have plagued the housing market.

Commercial real estate hasn’t had to deal with subprime mortgages, home loan, adjustable rate mortgages, and interest only mortgages. Also, the commercial market hasn’t had the concerns regarding unrestrained mortgage lending by mortgage lenders and mortgage brokers. Additionally, overcapacity isn’t an issue in the commercial market as it is in the housing market.

Herein, the commercial sector has been able escape the residual effects of the housing market excesses that led to the bubble burst in the housing boom. Quite the contrary, commercial real estate is quite upbeat about future prospects.

Strong growth in the retail and office segments has garnered over $401 billion so far this year, a jump in over $40 billion sales from last year.

Strong sales have led to increased construction activity, leading to a rise in nonresidential projects like, shopping centers, office buildings, and other projects by 15.2 percent, according to the Commerce Department.

Fortunately, the momentum is sustainable; there haven’t been comparable foreclosures or mortgage defaults as in the housing market. Experts believe the reasons commercial real estate hasn’t seen the effect as the residential counterpart is because buyers and sellers are now more sophisticated and they have the financial resources to weather any corrections in the market.

Unlike the housing market, commercial real estate development has deep ingrained direct relationships with banks. However, that doesn’t mean that the commercial market can stay unaffected by the residential market. The economic effect of the housing market can lead to upward pressures in commercial real estate in many spheres, including new construction.

While the fundamentals in the commercial market remain muscular it is still unclear the extent of, if any, residential housing will have on it.

If the broader market is able to sustain itself, experts don’t foresee an issue with commercial real estate. But a economic correction could make the market vulnerable, a situation which it has been able to avoid thus far.

As it happened to the mortgage market, the recent credit crunch has spread to other markets, in some respects to the commercial real estate arena. Some sellers have now started requesting more upfront capital if mortgage-backed assets are financing a deal.

Whilst, the housing market attempts to get back on track, the outlook for commercial real estate is mainly positive.