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Optimistic with a Chance of Pessimism

NEW YORK CITY-Industry panelists weighed in on the city's current and future states at the event hosted by the New York Times.

By Ryan Clark | Updated on October 21, 2010

NEW YORK CITY-”Immediate concern has abated,” keynote speaker Dr. Sam Chandan said, referring to the industry’s general attitude towards the market. There was progress, and although transactions were down from the peak of 2006 – 2007, he explained that back then it would have been just as easy to say transactions were “hit a new unsustainable high.” So things aren’t quite as bad as they may seem. Kicking off the “VU 2010 Focus on Commercial Real Estate: Leasing, Retail, Sales & Development” was the  global chief economist and EVP of Real Capital Analytics did not mince words, plowing through the issues facing commercial real estate as a William Jennings Bryan of CRE statistics.

The bid-ask spread had closed considerably and improvements in transaction volume were emboldening, but it is not all wine and roses. Chandan explained that much of the available capital was disproportionately focusing on the major markets, to the exclusion of others, and therefore it could be said that some of the pricing of properties did not necessarily match the underlying fundamentals of the market. “Capital has become more concentrated,” he said. “Investors want to be in the more liquid markets.” The focus of capital on these markets warned of another pricing bubble, but it was not too late, he explained, if investors in New York “proceed deliberately,” as risks abound.

Vivian Marino, staff editor of real estate, New York Times

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