It’s a buyer’s market for commercial real estate in Hawaii, but investors weren’t very active in the first quarter, according to a new report.

The value of commercial property sales statewide contracted 10 percent in the first three months of the year to $122 million on 17 sales from about $135 million on 23 sales in the same period last year, according to local commercial real estate firm Colliers Monroe Friedlander.

The dearth of activity showed that significant discomfort still exists among buyers, sellers and financiers of commercial property even as the market appears to be at or near a bottom.

"Investor cautiousness, tightened financial underwriting, the recession’s impact on tenant demand and seller hesitancy all conspired to create a difficult market to consummate real estate transactions," Colliers said in its report released yesterday.

The report tracks sales of more than $1 million on a wide variety of property that includes shopping centers, office buildings, hotels, golf courses, apartment buildings, agricultural land and undeveloped land zoned for commercial use.

Colliers forecasts that Hawaii commercial property purchases will pick up in the remainder of the year, enough to eclipse sales in 2009 but not enough to rival the prior year.

Part of the increase is expected to come from distressed property owners increasingly being forced by lenders to sell assets as opportunistic investors swoop in.

"It looks like transactions are starting to increase," said Mike Hamasu, research and consulting director for Colliers. "2009, from an investment perspective, was a disastrous year."

The largest sale in the first quarter was Mililani Shopping Center, which local firm Alexander & Baldwin sold for $50.3 million to California-based Stoneridge Capital Partners.

Another large transaction was 854 acres of Kunia farmland sold by Campbell Estate for $7.7 million to a farmers association led by Calvin Lui that plans to subdivide the property for small-farm use.

In a sign of how property values have changed, a group including New York-based Angelo Gordon & Co. bought the former site of Hawaii Raceway Park for $15.1 million. The price equates to about $5 a square foot for the land now zoned for industrial use, compared with a value Colliers said peaked at $35 to $40 per square foot just a few years ago.