"We also faced a financial system on the verge of an abyss," Hersh noted. "The answer now is to sit in neutral, preserve every dollar and manage balance sheets in a way to get through these times. There are still companies out there that feel it's necessary to raise the bar on expectations. That is a bubble waiting to happen."

There is a lot of expectation in the marketplace, and people are looking for opportunity, Klatskin noted. “There are property owners who do not understand real estate,” Rufrano said, pointing to the phenomenon of special servicers taking over troubled assets. "There continue to be special servicer opportunities."

According to Hersh, “There is an appetite among institutional investors for yield.” He pointed specifically to high-end, class A suburban properties as one target. "They are also buying debt,” he added. “But the conventional opportunities for properties that you would normally want to buy are almost nonexistent. There has been a devaluation of 20% to 40% for those type of properties, and you don't want to take that kind of hit."

Responding to a question by Klatskin about the state of the brokerage business, Rufrano indicated that for Cushman & Wakefield, "revenues are up dramatically in the past six months. Our capital markets group is selling a lot of assets. Margins are squeezed, but they're squeezed everywhere."

This is the “new normal, and it is going to go on for a long time," Hersh predicted. "There is a general malaise and paralysis in corporate decision-making, coupled with cost factors and general uncertainty,” he noted. “A lack of clarity is pervasive in the marketplace. But the current pricing does provide an opportunity for tenants, who will begin to move slowly back in the market.”