"I think this time of uncertainty creates opportunity for people like me," Peebles tells RENY. "We're a mid-sized development firm looking to break into a very competitive market, probably the most competitive in the country. It's got a very strong, capable local development community with lots of experience and lots of capital. So it's difficult for companies like mine to come into the marketplace and distinguish ourselves. In this environment, where there's a sense that local developers are kind of on the sidelines, there's a better opportunity for us to get into the market than, say, two years ago."

In common with Orbach, Peebles foresees his company establishing itself in New York by playing to its proven strengths. "The residential market sets the tone for the New York market as a whole," he says. "There are more people who want to live in New York City than there is available space. Then you've got the hospitality market, which is one of the strongest in the country, and New York is an international travel destination. From our perspective, we're looking foremost for hospitality opportunities and maybe residential opportunities. If we found a great commercial office building site, that would be something we'd look at, but we would be more inclined to make an acquisition than do new construction in office. Opportunities in hospitality and residential fit better with what we think we can bring to the marketplace." He adds that an office development might occur within the context of a mixed-use project.

Peebles says he's zeroing on a couple of prospective parcels and hopes to identify a development site within the next few months. "We're being selective, because in this economy you don't want to overpay," he says. "Also, we want to find the right fit for our concepts."

Before shovels go in the ground on that first development, however, Peebles Corp. plans to establish a presence in the city by creating a private equity fund to assist up-and-coming entrepreneurial developers. "We do business in several markets around the country, and one thing I continue to see is that for the small local developer, the biggest challenge is not to identify an opportunity but to finance it," says Peebles.

The fund would be aimed at "the smaller developer who's doing a $40 million to $80 million project," Peebles says. "Those projects normally don't get the attention of the larger investment banks or the private equity firms, because the investments are not economically viable for them. So they overlook the small-to-mid-sized developers, and those are the ones that are normally doing the deals in the marketplace."

Additionally, the fund—for which Peebles is negotiating with a financial partner—would aim to give smaller developers the benefit of Peebles Corp.'s development acumen. "Along with the capital, the challenge for the small developer is stepping up to the next level or having the track record to convince the lenders that they have the capacity to go to that next level," he says. "We feel we can bring our development track record to help offset the experience issue"—and step in to complete a project if need be.

The fund's backing of financing and developing expertise would be "unique compared to the typical financial firm that has a real estate fund as one of its products," says Peebles. "If anything goes wrong, they have to bring in another developer to finish the project. That of course increases costs, lowers the return and makes a bad situation even worse."

He says the fund will start off "in the $300 million to $400 million range, and make investments in the $5 million to $20 million range per project." The hope is to launch the fund late this year—a time frame in which Peebles expects financing issues to be especially acute for smaller players.