The volume of investment in the global commercial real estate space skyrocketed in the second quarter, compared to a year ago, with large gains particularly in North American markets. But the good times may not last. An outlook report from Deloitte & Touche on the commercial real estate market is titled “A year of gain or pain.” And it’s easy to see why. That report concludes that more than $1.7 trillion worth of CRE debt — held by banks, commercial mortgage-backed securities, life insurance companies and other lenders — will come due between 2011 and 2015. And an estimated 60% of these loans are underwater. But investors remain interested in the market globally. “Looking ahead, debt concerns in some advanced economies and the risk of overheating in some emerging markets will induce caution and careful asset selection, adding to a natural deceleration in the recovery,” said Arthur de Haast, head of the international capital group at Jones Lang LaSalle said. “Nevertheless, the pipeline of product in the market gives us confidence that full-year volumes will reach our forecast of $440 billion,” he said. Haast based his estimations on the latest market reports from Jones Lang LaSalle, a global commercial real estate juggernaut. According to the report, global direct real estate investment volumes in the second quarter of 2011 totaled more than $101 billion, up 7% from the previous three months and a staggering 47% from the second quarter 2010. All property sectors in the United States experienced strong growth given the increased debt availability and a hunger among investors for yield options in the very low interest rate environment, the report states. Volumes for the region rose 56% from the first quarter of 2011 to $49 billion. Commercial real estate analysis from Deloitte cautions on the bullish CRE market continuing into the second half of the year. “The story of real estate in 2011 is decidedly a tale of two markets,” says Guy Langford, a principal with Deloitte. “While people are no longer talking about commercial real estate as the ‘other shoe to drop,’ there certainly are some elements within the market right now that are cause for concern.” And it’s not just a shift in property fundamentals that may damage the rally. Deloitte said uncertainty remains over how lenders may react to Dodd-Frank regulations that come into play on the one-year anniversary of the financial reform signing. More importantly, however, is the dragging macroeconomic conditions. “Job growth is a key driver for the apartment, office, retail and industrial real estate segments,” says Langford. “Until unemployment decreases from its uncommonly high level, growth in the CRE market likely will be hampered.” The market for CRE debt maturities is facing a glut of potential refinancings, according to the commercial real estate 2011 report from Deloitte. However, the outlook is not grim across the board. Jones Lang LaSalle’s global capital markets research director Paul Guest said: “Our forecast calls for a further $240 billion to transact in the second half. There are several supportive factors to note: Japan will rebound from March’s natural disasters; there is additional bank product coming up for sale in Europe and the United States, some of it very good quality.” “Nonetheless, the rate of growth has started to decelerate and this will continue, particularly as central banks continue to tighten around the world,” he added. Write to Jacob Gaffney. Follow him on Twitter @jacobgaffney.