(Read more on the multifamily market.)

WASHINGTON, DC-This year has been a roller coaster ride for the commercial real estate industry thanks to the credit crunch that began in August. However, on the regulatory front, several bills have passed or are expected to pass next year that mitigate, to a certain extent, the setbacks in the capital markets. These regulatory issues include the expansion of the terrorism insurance backstop, to affordable housing, to carried interest tax, to sundry issues important to the multifamily industry.

The Terrorism Risk Insurance Program Reauthorization Act of 2007, passed by Congress on Dec. 18, was perhaps most important to the commercial real estate industry. The new legislation extends the backstop for seven years and adds domestic acts of terrorism to the coverage. Another top issue closely followed by the industry is the question of whether carried interest will be taxed at higher rates. In this case, no action was decidedly the favored response by the industry and for the 2007 legislative session, it got its wish. In November, the House voted in favor of changing the rate to pay for a fix to the Alternative Minimum Tax, but the Senate did not. The compromise bill passed patching the ATM left the tax treatment of carried interest unchanged.

Indeed, this non-legislation was arguably the industry's most significant victory in Congress for 2007, according to the National Multi Housing Council and National Apartment Association's overview of legislative initiatives for the year. The organization also praises a law that has been already signed by Pres. George Bush that encourages energy efficiency in commercial properties and provides federal resources and clearinghouses to help achieve those goals--but it does not establish specific performance metrics, and requires that any metrics be economically viable. It has also lent support to a law sent to the president for signature that directs the US Environmental Protection Agency to work with the National Institute of Standards and Technology to create voluntary guidelines to remediate former methamphetamine laboratories. It also directs the National Academy of Sciences to prepare a report on the health effects posed by former meth labs to residents and calls for research to develop rapid-detection kits to identify meth labs. NMHC/NAA sought an expanded federal role in this area because of the differences in decontamination protocols adopted by various states and localities.