In some ways, the climate in the post-Wall Street meltdown marks the end of an era, said McCain, chief investment strategist at the Cleveland-based bank. It also follows the typical pattern of any economic cycle, which includes a topping-out, decline, bottoming-out and, eventually, a rally. The bottoming-out phase, he said, "seems to be where we are right now." The question is how long it will take to "wash out the excesses and prepare for the next rally."

McCain's view that the economy is still looking for the bottom was shared from a real estate perspective by panelist Michael Newman. "What we're seeing now is just the tip of the iceberg," said Newman, president and CEO of Golub & Co., based in Chicago. The owner and developer observed that the challenges faced by retail tenants are now starting to spread into the office sector.

Also on the rise will be distressed debt. Newman noted that there haven't been many reports of defaults in the middle market; so far it's either been loans on the order of $10 million to $20 million or the troubles faced by large-scale owners and developers such as General Growth Properties and WCI. That will change during the course of 2009.