Industry experts speaking at the 14th annual Utah Commercial Real Estate Symposium at the Salt Palace on Thursday morning offered projections on what this year will hold for the office, industrial and retail property markets in the Salt Lake City area.

And their projections are in line with what many Utah economists have been saying: that commercial and governmental construction projects that include the City Creek Center in downtown Salt Lake City, the development of the Legacy Highway and other big jobs should make up for much of the downturn in residential building activity.

Chris Kirk, who specializes in the office market at brokerage Commerce CRG, said the low vacancy rates in that sector can be expected to increase by approximately 2 percent in the coming year with lease rates stabilizing.

Construction of office buildings will continue at a high level in 2008, he said.

And while heavy competition for tenants will lead landlords to offer concessions such as higher tenant improvement allowances, Kirk said there will continue to be strong demand for new and existing space that should help make 2008 a solid year for the Salt Lake City office market.

Retail property expert Rob Moore of Coldwell Banker Commercial NRT said there are questions about the effect the slowdown in the residential real estate market and the "uneasy feeling" in the economy will have on retail in the coming year.

But the bottom line is that the state's retail market remains one of the healthiest in the nation, Moore said. "Retailers will continue to come to Utah. And if [developers] can finance your [retail] projects, I believe they will be very successful."

He said new tenants expected to enter the Utah market this year include Ulta Cosmetics, El Pollo Loco, Shari's Restaurant and Corner Bakery.

Addressing the challenges in the industrial property sector in the Salt Lake City area, M. Douglas Scheel of CB Richard Ellis pointed out that 2007 was a better than average year with 2.7 million square feet of industrial space added to the market.

He said while total lease activity was down in 2007 compared to 2006 - there was nearly 3 million square feet of industrial space leased last year - it still was significant given the amount of new industrial space coming on line.

"In 2008 it should be ready, steady, go," he said.

Scheel projected that lease rates for industrial properties, which typically house manufacturing and warehouse operations, should continue to increase because of the high cost of construction and land prices.

But the increase in lease rates won't be enough to lead developers to overbuild, he said.

About 730 commercial real estate agents and brokers attended the symposium sponsored by the Utah chapter of the National Association of Industrial and Office Properties. Those in attendance included 50 people in Provo and 50 in Ogden who viewed the proceedings remotely.

steve@sltrib.com