Experts in distress, including the DAI advisory board members providing insights here, agree that 2012 will see more problem properties emerging than this year, but most believe this larger pipeline will mean good things for the industry. The few naysayers, however, posit that the third quarter's depressed fundamentals, including the European debt crisis, signal too many problems for distress professionals in the next few years. Alan Pontius, national director of special assets for Encino, CA-based Marcus & Millichap, says these past two years have shown improvement, conflicting with the prediction for 2012. "There's been a shrinking volume overall in delinquencies for the past seven quarters," Pontius says. "We're also seeing workouts outpace the new introduction of distress into the system." Outstanding distress as of early November was $172.4 billion, and workouts were expected to make a strong dent in this figure, according to Real Capital Analytics.

However, Pontius says the total $1.77 trillion in estimated commercial and multifamily debt maturities in 2011- 2015 will force expansion in the overall volume of distress. This signifies a bad situation, as added properties will bring existing price points down. But there's a more positive possible outcome, Pontius says, as lenders will be forced to "prune their books of distress."

As an example of the growing pipeline, in November Miami-based Easton Lynd purchased $49 million worth of notes on Florida multifamily assets from seller LNR Property LLC, also based in Miami. David Lynd, president and COO of Easton Lynd's sister company, Lynd Co., says he expects to spend about $150 million on the expected opportunities.