| Premier Edition - Forecast for Commercial Real Estate Values | March 2009 | Commercial Real Estate income lags the larger economy. The lag has been seen with each prior recession and all evidence suggests a
continuation of this trend. The challenge for participants is to quantify the impact of this recession on the depth and duration of price reductions. Lack of agreement between buyers and sellers on pricing has contributed to a sharp drop in transaction volume. To remove the log jam, the job of the Researcher is to explain the boundaries of likely scenarios. In this short piece, I describe the possible drop in pricing based upon plausible declines in occupancy and rental rates. These assumptions lead to a prediction of office property income reducing by 38% with the decline lasting into 2011. Combine this with an increase in the cap rate from 7% to 10% and we are facing a value decline of nearly 60% by the end of 2010. - read more - |
| Smart Decision Making in Tough Times | April 2009 | Its springtime in New England and signs of emerging life are everywhere. Tree branch tips are bright red in the morning sun and bulbs have pushed their green shoots from cool ground. The daffodils are blooming and the crocuses have already passed their prime. Still, it was just above freezing last week and the squirrels are looking pretty thin after a long cold dark winter.
The analogies for the economy are striking. The stock market rallied, financial institutions reported unexpected profits, consumer confidence improved, and other leading indicators rose. Still, we are a long way from full recovery. Clearly there is much to be hopeful about even as institutions continue to shed jobs or fail. Good farmers know the right time to plow and plant. So too must the good manager know when to make changes in their business. - read more - |
| Virtual Organizations, Real Benefits | May 2009 | This piece visits the evolving concepts of virtual corporations, social networking and cloud computing. It strives to help you and your organization improve efficiency and accelerate response to changing customer needs and economic conditions. Virtual corporations are those with minimal physical presence. Put another way, they don't really exist until there is work to perform. When needed, they bring together the resources to do the job. When the work is finished, they disband those resources until the next project. Social networking refers to a set of internet based programs allowing people with similar interests to form communities for quick, borderless communication. These programs include Facebook, LinkedIn, Twitter, Ning, and others. Cloud computing in this context is defined as leased, off-site computer hardware and software systems. They are usually connected via the internet and have the benefit of outsourced scalability. Combined, these concepts present powerful new tools for your organization to offer better client solutions in less time for less money. - read more - |
| Finding Value | July 2009 | Initiative is the starting point for any venture. If you want to catch a fish, you can hire a guide, or buy your own equipment, or even tie your own flies. But first, you have to decide you want to catch a fish. The importance of will power can not be over stated in analyzing successful enterprises. Proponents of Zen suggest that letting go of ego driven ambition will help you succeed by allowing you to better recognize patterns in life, allowing for a more direct path to your objectives. Imagine playing the old video game of asteroids,and being able to see all the objects in motion so well that you could steer and move with the minimal effort to glide through the asteroid field without ever firing your blaster. The alternative strategy of shoot everything and fly fast is much easier on the brain, but creates a lot of rubble which eventually makes it impossible to fly without getting hit by the debris of your own destruction. Perhaps the Zen enthusiasts have it right. In either case, it takes a sense of purpose to care enough to fly, or to fire. Applying the analogy to today's commercial real estate markets, there is clearly a lot of flying debris. Turning that debris into lucrative assets is how we turn the game around and how we define winning. To see the game clearly, you need good information and a clear head. In this edition we will explore some of the sources of information on distressed properties and see how to use them to find opportunities. - read more - |
| Making Sense of Messy Data | September 2009 | Are you an expert in commercial real estate? Malcolm Gladwell's Blink, the Power of Thinking Without Thinking suggests we are all experts in myriad subjects and simply lack the nomenclature to communicate with others. By way of example he describes our ability to recognize faces instantly and accurately. It's something we can all do very well, but few of us are able to describe a face sufficiently for another person to recognize an individual. Forensic artists are able to communicate within their field using terms defined by fellow practitioners, allowing them to precisely describe a face. In a similar way, most of us can recognize a high quality, well located office tower in comparison to a lower quality, more poorly placed property. Along those lines, we are able to differentiate the value of two properties from our own knowledge of the basic forces influencing pricing. But to accurately and precisely define the value of a property, you need market data. The difficulty arises when you review the data available for commercial real estate (CRE) and discover inconsistencies between sources. How do you know which sources are accurate? In this article I will review the sources, issues, and solutions for data. As CRE defaults mount, threatening the larger economy with a double dip recession, a better understanding of the data will help you gauge the opportunities and make more informed decisions. - read more - |
| Who Controls Pricing? | December 2009 | The stock market is up, unemployment is down and shopping baskets are filling up for the holidays. We are experiencing signs of a tepid recovery as confidence slowly returns. With the prospect of a long, slow improvement in the economy, investors are looking for opportunities to profit. In this environment, it is critical to place your bets with a clear strategy. Leading indicators for different asset classes provide mixed signals, clouding decision-making. The movements of the stock market are fluid and somewhat unpredictable as it reacts instantly to news, statistics, and perception. It can be a gut wrenching experience for anyone with a vested interest in performance. Commercial real estate (CRE) however is much slower moving, with fewer visible indicators, and yet, it is far more predictable. In this edition we will explore the major forces that influence commercial real estate pricing, helping you make more informed investment decisions. - read more - |
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| Business Week | November 2006 July 2007 |
| CPN | October 2004 |
| Global Markets Bulletin | May 2007 |
| Globe Street | February 2008 31 other articles |
| HiFx | December 2006 |
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| PKF Trends 2008 Edition | 2008 |
| RE Forum | |
| REITTalk (mp3) | October 2007 July 2007 April 2007 |
| Realcomm | February 2015 |
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| The New York Observer | July 2007 |
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| Wall Street Journal | July 2007 |
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