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economy suffered a recession from July 1990 through March 1991 and
that a recession in Genesee County began at the same time, but did
not end until late 1993. Dr. Perry testified that a "recession"
occurs whenever the gross domestic product decreases for two
consecutive quarters. Dr. Perry ascertained the following seven
facts concerning the condition of the commercial real estate market
in Genesee County and concluded that these facts affected negatively
the condition of that market and the real estate values therein:
(1) The average annual increase in rent for one- and two-bedroom
apartments in Genesee County for 1987, 1989, 1991, and 1992 was less
than the rate of inflation for the corresponding year, (2) rental
income from the apartment complexes decreased from 1987 through 1992,
(3) Fox Hill's vacancy rate was slightly higher than the average for
the Grand Blanc area, (4) the office vacancy rates in Flint and Grand
Blanc were 21 and 17 percent, respectively, (5) investment in
apartment buildings between 1986 and 1992 declined nationally,
(6) the rate of return on investments in apartment buildings declined
nationally between 1990 and 1992, and the rate of return was negative
in 1992, and (7) the economy in Genesee County was heavily dependent
upon the automobile industry during the years under his review, and
an economic contraction in this industry from 1990 through 1993 had a
negative impact on the economy in Genesee County during those years.
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