GlobeSt.com: What has caught your eye in the multifamily market?

Ellis: The multifamily market is the one asset class where you have very strong supply and demand fundamentals. In most of the other asset classes you see excess supply and weak demand, which is the recipe for depressed values, rent rates going down, values going down, etc. In multifamily, you have the perfect storm. You’ve had no real new construction in that asset class in any particular market for the last three years. And with every 1% decrease in home ownership, you add a million new renters into the market.

GlobeSt.com: Are you concerned about overbuilding in multifamily?

Ellis: Yes. We always overbuild. It’s a given. We will over-build. We are believers in early cycle multifamily development and we’re clearly in the early stages of that cycle. But developers always tend to overshoot the mark. At some point in the future, you’ll see that happen. But it’s tough to do it early because there has been so little construction right now.

GlobeSt.com: So the key is getting in on that first wave.

Ellis: Yes, absolutely.

GlobeSt.com: What impact is the multifamily recovery having on retail?

Ellis: In order to kind of meet growth projections, you’re starting to see a lot of retailers begin to come off the sidelines. But until we see real job growth, you really won’t have a significant change in retail. In a lot of the asset classes, office and retail in particular, that’s what we’ve seen really in the last year, that most of the activity has just been a reshuffling of the deck.

GlobeSt.com: What do you expect going forward?

Ellis: I think it’s going to be interesting. The political environment going into 2012 is something everybody’s really watching right now. Job growth is number one on the list, but number two is the political environment. Business just needs to know what the rules are going to be because when decision makers are indecisive they are hesitant to hire new people and demand more office space.