THE downturn in the nation's real estate market will hit hardest in the commercial sector, which is severely overbuilt, an industry consultant predicted Wednesday. ``The problem is that you have an oversupply in a liquidating marketplace,'' said David A. Eisner, a partner in the real estate group of the accounting firm Price Waterhouse, in a speech to about 200 executives at the University Club of Los Angeles.
Mr. Eisner estimated that the volume of commercial real estate lending this year has declined by 50 percent from last year.
Real estate developer John Miller, a partner with Los Angeles-based Lincoln Property Co., said the industry is paying the price for its excesses during the 1980s. Over the next five years, Mr. Miller said, banks will become increasingly reluctant to issue real estate loans and the size of commercial business will probably be cut in half.
Eisner said the slump will be exacerbated by a sharp decline in Japanese investment and the failure of major pension funds to make major buys.