The peak of distressed properties has come and gone, according to Gregory Leisch, chief executive officer of Delta Associates. "Our conclusion is that we have reached a plateau in the volume of distress," Leisch said during a special address at the second annual Real Share Distressed Assets conference at the Adolphus Hotel in Dallas last month. More than 350 executives attended the conference, which was produced by ALM's Real Estate Media Group. Leisch's contrarian observation was just one of the highlights of the day-long conference.

"From March 2009 to March 2010, we saw distress increase about $10 billion per month," Leisch noted. "Since then, it's been flat. Therefore, it is our thesis that we have seen the peak." As more proof to back up his theory, he added that this month, for the first time, the industry has seen a decrease in construction-loan delinquencies.

Leisch said the most recent distressed cycle was shorter than the cycle in the early 1990s. For example, property values rebounded in second quarter 2010 after only eight quarters, according to NeREIF. During that period, values declined 33%. In contrast, during the 1990s downturn, the US experienced seven years of negative property trends for a total decline of 39%, he recalled.