Culkin’s address was followed by the day’s opening session, “A Bird’s Eye View: Is Multifamily Tenancy Out of the Woods?” Moderated by Hessam Nadji, managing director of research services for Marcus & Millichap Real Estate Investment Services, the panel’s speakers all had good things to say for the sector. Greg Willett, vice president of research and analysis for MPF Research, noted that the average national occupancy level has grown by 210 basis points from its year-end 2009 low to 93.9% as of the third quarter, and effective rents for new leases are up 2.6% from late 2009.

Yet the biggest factor of note for 2010’s “impressive performance” is resident retention by apartment firms, particularly at a time when new lease turnover is very high, said Willett. The churn in the shadow market, he added, is “incredible, and apartments—the safe rental choice—are picking up households from riskier rental alternatives, such as condos or single-family homes put on the market for rent.

Typical year-to-date revenue growth for major metros has been between 3% and 6%, although Willett pointed to some standout performers with revenue growth in excess of 8%, including El Paso, TX; Nashville; San Jose, CA; Baltimore; Birmingham, AL; and New York City.

The panel—which also included Tom Bannon, CEO of the California Apartment Association, David Ronco, managing principal of Grubb & Ellis Alesco Global Advisors; and Sharon Dworkin Bell, senior staff vice president for multifamily and 50+ housing for the National Association of Home Builders—generally concurred that the economy is likely not headed for a double dip, but economic and job growth will be very slow. Bannon admitted that California is in a less favorable position than the rest of the country. The state’s major problem, he said, was the lack of confidence, particularly with the state deficit, the problems in the government and the uncertainty over the outcome of certain propositions that are on the ballot this election season.

On the development end, Dworkin Bell said that developers have scaled back considerably. “Those that would have built 2,000 or 3,000 units a year are doing nothing this year, or very little,” she said.

In terms of legislative issues, she indicated that while Congress will cover a number of major issues, there will likely be no resolution until the next presidential election. The uncertainly on Capitol Hill—especially over GSE reform, major tax reform and the outcome of the midterm elections—is causing uncertainty in the business community. On the bright side, Dworkin Bell points out that she is seeing the financing market ease a bit, and slow, yet steady improvement in the economy.

Sharing some thoughts on REITs, David Ronco noted that multifamily trusts are only trading at a “very modest discount to net asset value,” somewhere around 10%. “Investors have learned the importance of liquidity, and the liquidity premium for REITs is at an all-time high,” he said. While some observers may balk at the prices for which some REITs are trading, Ronco said, “the operating expertise, development expertise and acquisition expertise of REITs is well worth the premium.”

Wrapping up the session, moderator Nadji asked the panel a few quick questions: Will apartment demand be the same, weaker or stronger a year from now? The resounding answer was stronger. Most panelists also said they expect to see very strong rent growth—high single- or low double-digits—for one to two of the next three years. Yet when asked whether apartments in Southern California are a hold, buy or sell, half the panel said hold while the other half said buy.