CHICAGO—Several years ago, the landscape was dotted with recently-completed but empty industrial structures that, due to an unrealistic optimism, developers built just before the bottom of the market dropped out. And one of the most-discussed topics yesterday at BMO Capital Markets' 10th Annual North American Real Estate Conference was whether or not the market had once again become too exuberant. But leaders of some of the continent's major REITs generally felt that a return to those bad old days was not on the horizon.

“Historically, overbuilding is something you need to pay attention to,” William Hankowsky, chairman, president and chief executive officer of Liberty Property Trust, said at a morning panel on development opportunities. But, these days, “lenders are a little more cautious,” and this tends to put the brakes on the type of exuberance that overtook the industry in 2007. “It doesn't really exist the way it used to.”

Furthermore, he added, these days “customers very much want state-of-the-art product. They don't want that low ceiling height,” or other obsolete features, and this desire is fueling demand as the economy continues to recover. “I don't think we run the risk of overbuilding.”