HOW'S DEALMAKING VELOCITY BEEN SO FAR IN 2008?
It's early yet, but 2008 doesn't seem set to be a blockbuster year. Not judging from responses to this week's poll, at least. Nobody claimed that dealmaking velocity was great so far. Two thirds of the respondents say that things are ok, but not fantastic. One third report a slow start to the year. Jeff Schotz, executive managing officer with GVA Williams New Jersey tells us what he's seen so far and what he expects in 2008.
"It's still premature to talk about dealmaking in 2008 because we're only a month into the year. I can better address the velocity of activity that we're seeing in the marketplace so far.
"Although we as a firm are seeing activity, overall it appears that the activity level has been off over the last couple of months, not just in January 2008. Starting a couple of months ago, we began seeing a decrease in the velocity of new deals coming to the market.
"With the subprime crisis and recession concerns, the overall picture of the economy is a bit cloudy right now. Our business ultimately is based upon and is driven by consumers. The more consumers buy stocks or furniture or other services, the more jobs get created. The more jobs get created, the more space is needed. Less buying means less jobs and less space, so right now we're in flux and corporations are waiting to see what happens. There's been a definite shift in consumer confidence. How far that's ultimately going to be will determine whether or not this curtailment of activity over the last few months is going to be long term or short term, large or small."
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