Commercial Real Estate Moving from Recovery to Expansion

Industry leaders discussed the transition from a recovery phase to expansion in the commercial real estate market during a panel at the Real Estate Luminaries Series event on May 3 at Georgetown University. The event was sponsored by NAREIT and Georgetown’s McDonough School of Business.

Thomas Carr, managing partner of Federal Capital Partners, moderated the panel with Martin Cohen, co-chairman and co-CEO of Cohen & Steers, and Wesley Edens, founder and co-chairman of the Fortress Investment Group. The panelists gave the government credit in helping the commercial real estate industry bounce back from its low point.

“The government did a remarkable job during the downturn to get the ball to stop rolling down the hill,” Edens said. “It’s amazing that it all happened two years ago and we are able to put it behind us. In 2008 and 2009, it all could have ended.”

Carr said the quick onset of the market recovery should be looked at with both optimism and as a cautionary tale. This is especially true when it comes to being transparent, according to Cohen.

“One of the things that becomes evident during a crisis is that a lack of transparency can be very costly,” Cohen said.

Cohen emphasized that while the federal government helped in recovery efforts, the public market ultimately came to the industry’s rescue.

“The public market saved the industry, and the same thing happened in other cycles,” said Cohen, adding that the public market’s securitization of capital and development of new companies was a boon to the industry.

What worries keep Cohen, Carr and Edens up at night? Rising interest rates, according to both Cohen and Edens. Edens also added that people are skeptical about real estate cap rates. He said some observers even worry that the downturn didn’t last long enough.

Looking ahead, Edens said the biggest opportunities right now lie in health care real estate, especially in places like China. For example, there are 165 million people in China over the age of 60, noted Edens, adding that there is limited senior housing in the country at present.

Cohen said he sees global opportunities in the office sector in places like London and Hong Kong, where public companies are more developed.

IN NEWS

Commercial Real Estate Moving from Recovery to Expansion

FEATURED

COMMENTS

IN NEWS

UBS Focuses on Rebuilding U.S. REIT Practice

Identifying Best Practices Key to Going Green

Borrowers Struggling to Finance Smaller Deals

Industrial REIT Recovery Gaining Speed

United States Catching Up on Sustainability

Brookfield Announces Leadership Changes

Multifamily Momentum Will Continue

Capstead Counts on Low Risk Portfolio

Vornado’s Steven Roth Dishes on Conference Calls, Portfolio

REITs Up in April Despite Sluggish Economy

CONNECT WITH US

FEATURED

United States Catching Up on Sustainability

Multifamily Momentum Will Continue

Loan Market Needs 'Creative Destruction'

Sustainability Improves Bottom Line

Capstead Counts on Low Risk Portfolio

Explore REIT.com

User Name:
Comment:

Enter Code:	*