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New Dynamics Come into Play

Six months ago, Marcus & Millichap Real Estate Investment Services managing director Alan Pontius summed up the 2011 outlook in the pages of DAI,…

By Paul Bubny - Managing Editor for Real Estate Forum. | Updated on July 01, 2011

Six months ago, Marcus & Millichap Real Estate Investment Services managing director Alan Pontius summed up the 2011 outlook in the pages of DAI, noting that “investors will likely move down the quality spectrum as premium property returns dip and the cap rate/interest rate gap, along with locking in cheap debt ahead of rent growth, provide a safety net. Financing will ease further, but tight underwriting is here to stay, even as the commercial mortgage-backed securities market expands and banks become more willing to lend.”

With the year at its midpoint, the Encino, CA-based Pontius’ forecast has proven accurate; however, new dynamics have come into play over the past several months. Ranging from the reemergence of private equity to proposed accounting changes that may compel banks to clear more troubled assets off their books, these factors could make a difference in who’s buying and what’s for sale over the next several months. We talked with our editorial advisors to track the shift s we face.

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