After months of little activity in the investment sales sector, the volume of retail transactions in the first quarter amounted to only $7 billion, an 81 percent decline from $37 billion during the same period in 2007, according to the first quarter report from Reis, Inc., a New York City-based commercial real estate data provider. Portfolio sales, which made up the bulk of activity in 2006 and 2007, have been virtually nonexistent this year, coming off a high of $208 billion for the entire commercial sector in 2007. The change has been due to the decreased appeal of properties in secondary markets and the difficulty in getting enough financing, according to Sam Chandan, chief economist of Reis.

The price depreciation in the retail sector for the properties trading hands has been relatively modest, down 2.8 percent from the second quarter of 2007. However, part of this is because only the best assets in large markets are trading hands. Had lower quality properties been trading, it's likely the price drop would have been more severe.