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Commercial real estate representatives said at a forecast competition Tuesday that they expect the slowing economy will take a bite out of the local market this year.

Agents and brokers said they expect to see a slowdown in expansion and slightly higher vacancy rates across the board — in the retail, office and industrial markets and in apartment buildings.

"People are kind of playing a wait-and-see game with the economy," said Mark Biery, an associate broker for Chapman Lindsey Commercial Real Estate Services.

Biery spoke before about 400 people at the 2008 Pima County Commercial Real Estate Market Forecast Competition held by the Southern Arizona CCIM chapter at Loews Ventana Canyon Resort.

Select real estate specialists provided competing market forecasts. The agent or broker closest to the actual numbers for 2008 reported by the University of Arizona Office of Economic Development will receive an award.

Here is a rundown of what commercial real estate representatives had to say about each aspect of the market:

Greg Furrier, an agent with Picor Commercial Real Estate Services, said large retailers will be cautious about expanding. Meanwhile, smaller retailers will likely start demanding concessions, he said.

Nancy McClure, an agent with CB Richard Ellis, said national tenants may delay their opening dates on concerns about a slowdown in spending. But retailers still regard Tucson as a growing market, she said.

"People still want to move here, and we're still seeing growth in the form of population," she said after the event. "That's always good news to retailers."

The closing of Tucson-based mortgage lender First Magnus Financial Corp. pushed the vacancy rate to a higher-than-expected 13.4 percent in 2007, according to the forecast report, which uses information from the University of Arizona Office of Economic Development. But office market specialists said that demand is still strong for Tucson office properties.

"The Tucson market is in much better shape that office markets throughout the country," said David Volk, of CB Richard Ellis.

Agents who handle apartment sales said they thought the slowdown in the housing market would be good news for apartment owners in Tucson, but they turned out to be wrong.

Bob Kaplan, of Picor, said the rental market has suffered from the addition of 2,000 to 4,000 investor-owned homes that are now being rented out. Arizona's employer sanctions law has also created some vacancies as illegal immigrants leave apartments, agents said.

There was good news for agents to report on the industrial front, which has recently been a particularly strong commercial market in Tucson. But forecasters still predicted an increase in vacancy rates stemming from the economy.

Early this year, The Rockefeller Group purchased 22 acres near Tucson International Airport to develop a new industrial center. The anticipated coming of a Target Corp. distribution center in 2009 and the growing presence of solar companies are also giving a lift to the market, agents said.

"I've never seen companies spend money like these solar companies have," said Rob Glaser, a Picor industrial specialist.

Will White, of Land Advisors Organization, said 2008 will be a "shake-out" year for the land market, and 2009 will likely be the beginning of a recovery. White and James Marian, of Chapman Lindsey, said sales have tumbled as investors wait on the sidelines for land prices to drop.

Marian added that he is not certain whether the land market will recover quickly from the slowdown.

"I think a lot has to do with just confidence," he said. "There's a lot of unknowns out there."