So, again, Keystone looks to reinvent real estate, so we see opportunities where reinventing real estate can create value. And location and cost basis drive every investment decision in real estate; which by the way, was completely true until the global financial crisis when we learned there was this new acronym called BLT: basis, location and timing. Timing sneaks up on everyone.

GlobeSt.com: Do you look at a lot of distress right now?

Glazer: We would be happy to…I mean buying distressed assets or distressed debt was so fashionable during the crisis, but what we’ve been seeing and what our peers have been reporting to us, is that this tsunami of distressed assets which were expected to flood the market never came.

Instead what we’re experiencing and hearing about is that borrowers and lenders across the country that are working through problems with assets on a case by case basis, because typically lenders are going to maximize their asset value when their working with existing borrowers, rather than letting the assets go through a fire-sale process. In which, it was in vogue to pick up dirt-cheap real estate.

Well, that’s not in the best interest of the lenders who want to maximize their value and typically they’ll get the best value from the existing borrower.

So, in the event that the existing borrowers are unable to provide fresh capital to the transaction, then you have opportunities that open up to third parties to capitalize on distress. We certainly look to step in and we have certainly a couple acquisitions now and a couple acquisitions that we’re capitalizing off those situations. But, we just don’t see a lot available. At least in the space that we’re playing in: office and industrial in major markets.

GlobeSt.com: Do you look at particular size restrictions?

Glazer: We typically target transactions between $25 million and $100 million. However, we’ll go lower than that in core markets and we’ll certainly go higher than that through existing institutional capital relationships, where there’s really not much of a top range.

GlobeSt.com: Any reason you stay within that range? What is it restricted by?

BG: Well, we’ve got funds of private capital, so we’re deploying capital and we’d like to keep the capital slugs in bite-sized pieces, so as we’re building a balanced portfolio across a number of acquisitions, we want to use the capital for a number of deals.

GlobeSt.com: Is there a lot of private investor money? Do you use bank loans? How are you funded?

Glazer: We run funds with private capital, real estate equity funds that we control. And we partner with other institutional capital partners on the equity side and we’ll take on good capital. There are not a whole lot of real estate deals that I’m aware of that are all-cash transactions. There’s some amount of leverage in almost every real estate deal.

BG: Let’s go back…for people at any company that’s going to buy a transaction today, they’re going to need that capital because it’s so much less expensive form of capital. If you’re going to buy something all equity, you’re going to lose in any type of bid process where your competitors have a much lower cost of debt capital. That’s really the need to get financing for the transactions.

GlobeSt.com: Where do you see the market over the next six, 12 and 18 months?

Glazer: Barring any extreme, exogenous events and barring any shocks to the capital markets, we see the market as no better or worse than today, which is listless. I wish there was a driver to spike demand or spike jobs, but we don’t see anything out there.