Three quarters of commercial real estate executives surveyed by KMPG LLC said distressed real estate would have an impact on their investment strategies over the next 12 months.

Still, two-thirds of those surveyed said they consider property investment opportunities as better today than they were one year ago.

Greg Williams, national leader of KMPG's building, construction and real estate practice, said, "for most commercial real estate executives, the fundamentals behind real estate demand remain a concern and this seems to indicate that prices in many markets may not have hit bottom yet.

"Executives are struggling to find sectors and markets that can deliver a reasonable return on their investments commensurate with the risk involved."

Among the bright spots for commercial real estate investors are multifamily properties, as many consumers remain reluctant to purchase homes in the current economic environment. The survey found that 34% of respondents believe a significant amount of multifamily development will begin in the next year; the next highest sector was office at 22%, followed by retail, 20%; hospitality, 19%; and industrial, 17%.

Almost six in 10 commercial real estate executives believe today's key economic problems, including unemployment, job growth and cost of living in their primary markets will be better this time next year, with 34% believing these factors will be at the same levels they are right now.

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