NEW YORK CITY-At the NYU Schack Institute of Real Estate’s 44^th annual conference on Capital Markets in Real Estate Thursday at the Waldorf-Astoria Hotel, early events turned an eye to the availability of capital for financing and the overall economic outlook as the euro zone continues to struggle with debt issues.

At the morning’s Financing Panel, panelists including David Twardock, president of Prudential Mortgage Capital Co. and Jonathan Pollack, managing director and head of commercial real estate, Americas, at Deutsche Bank Securities, weighed in on CMBS and other matters relating to financing.

“It is slow the second half of the year,” Twardock said, while Pollack added that he thought that CMBS has actually had an active year.

Several panelists said that insurance companies were filling the void and helping to fuel volume. Michael Higgins, managing director and head of US real estate finance at CIBC World Markets Corp., said that there is fierce competition for quality assets and deals because of activity among insurance companies. “We’re competing with the insurance companies,” he said.  

“Thank God the insurance companies don’t do 65 plus leverage,” Ladder Capital founding partner Greta Guggenheim told the audience. Due to the increasing amount of maturing CMBS loans, she said, it is insurance companies and mezzanine financing that’s filling the void. Guggenheim pointed out that there will be $36 billion in CMBS loans maturing this year and by 2015 over $100 billion will be maturing.

Mark Fineman, managing partner at LoanCore Capital and CEO of Jeffries LoanCore, said that he believes that the deleveraging process is still happening. “People are reaching for yield,” he said, amid worries about the liquidity and solvency of Europe.

The situation in the euro zone drove the remainder of the Financing Panel, and much of the address that followed, by economist Sharmin Mossavar-Rahmani, a managing director at Goldman, Sachs & Co. Of note toward the end of the Financing Panel, however, was the assertion by Robert Merck, senior managing director and head of real estate and agricultural investments at Met Life, that uncertainty about the outcome in Europe was actually creating a lot of opportunities for insurance companies. 

“It may be that it creates more issues on lending from the banks,” Merck said. “But for insurance companies—we’ve been very active, particularly in London.” He said the crisis had generated opportunities for diversification outside of the US.

Mossavar-Rahmani, of Goldman, Sachs & Co., tackled the euro zone debacle as well, though she took a somewhat more positive outlook. “The first five years after a financial crisis you do have subpar growth,” she said. “But in the second five years it does recover.”

Economic indicators, she told the crowd, are good. “We think that there is more good news in terms of leading economic indicators than bad news.” The negative impact in large part, according to Mossavar-Rahmani, would likely be due to souring sentiment, which would affect appetites for risk. She said that even if portions of the euro zone were to default on debt that the affect in the US would be felt via negative sentiment and less so in direct ways.

Because of this, she said, “Our view is that we’re going to vacillate between the bad and the ugly.”