Nobody could make this stuff up when it comes to the election. Those of us in New York could never imagine Donald Trump could even run seriously, let alone maybe win the election. Few in the New York banking and construction trades would do any business with him. You knew he was going to try to screw you if you did a deal of any kind, and that he would try to renegotiate the loan or the deal at some point. On the other hand, we all knew Hillary and Bill Clinton are filthy and totally corrupt, so it really comes down to who will do more or less damage to one's life and business. That depends on who you are and what you do for a living.
If Hillary wins and Elizabeth Warren gets to have any influence on anything to do with financial services regulation, we are all in deep trouble. She is clearly a radical nut, and seems only to have intentions to run for president in four years by creating havoc in the financial services arena, and then taking credit for screwing the banks. Were she to have any real power beyond the media pulpit, she would do real damage to the banking system and to CRE as a result. The regulatory burden and likely environmental burden would become very costly, making some projects unfeasible because the banks would not make the loan or the compliance costs and rules would make it impossible. On the other hand, nobody knows what Trump might do about anything other than trying to build a wall, so complete uncertainty would prevail for maybe all four years. He would at least be good for real estate, but he might screw up everything else and hurt CRE in the process as a byproduct. We simply do not know.
Now with the new revelations from the FBI, and the total disgust of everyone with the both candidates, it is clearly too close to call. Personally I am betting Trump now wins because the corruption of the Clintons in my view will cause voters to stay home who may have voted for her, and will get more Republicans to come out to vote than would have, just to keep her and Bill away from the White House. However, whatever the vote, it is possible that due to Utah and the third party candidates, this could go to the House of Representatives for a decision. Recounts are surely possible. I guess anything is now possible.
It is inconceivable that FBI director James Comey does not already have some real evidence from the Abedin emails, or he never would have done this. He cannot come back later in the week and say we found nothing. He will be hung. His agents were already reading what was on that computer, and stumbled on whatever they found, and so the FBI has at least some strong preliminary indication, there is something real, and now they can put extreme pressure on Abedin to spill the beans.
The story behind the scenes is that this all stemmed from the custody fight between her estranged husband Anthony Weiner and Abedin, with his lawyer telling her lawyer that if she did not allow custody he had damning information. Her lawyer did not believe that, so Weiner's lawyer took it to the FBI. There is no way to know if that story is true, but it is feasible. If she is indicted she will not get custody, and the kid will go to a relative. If true, the FBI has a huge added pressure point on her.
So for CRE it is probably best to sit tight for a bit to see where all this goes. There is just a week left, and in this week there has to be something more from the FBI than we are still investigating. By using search programs and duplicate elimination, they likely can get back to a much smaller number to read, and then can assign teams of agents to review quickly to sort out the critical ones in a couple of days. There is also a good chance Wikileaks has much more to reveal and that will pile on the FBI investigation. Trump is now about even all of a sudden. So buckle up because this is going to be truly unprecedented. If Trump wins, then we will need to wait until spring to know how bad he really is, or not. A lot depends on who controls the Senate, and my guess is the Republicans hang on. If they do, then a lot of changes can happen, although, whether for good or bad is unclear.
Joel Ross is Principal at Citadel Realty Advisors. The views expressed here are the author's own.
Nobody could make this stuff up when it comes to the election. Those of us in
If Hillary wins and Elizabeth Warren gets to have any influence on anything to do with financial services regulation, we are all in deep trouble. She is clearly a radical nut, and seems only to have intentions to run for president in four years by creating havoc in the financial services arena, and then taking credit for screwing the banks. Were she to have any real power beyond the media pulpit, she would do real damage to the banking system and to CRE as a result. The regulatory burden and likely environmental burden would become very costly, making some projects unfeasible because the banks would not make the loan or the compliance costs and rules would make it impossible. On the other hand, nobody knows what Trump might do about anything other than trying to build a wall, so complete uncertainty would prevail for maybe all four years. He would at least be good for real estate, but he might screw up everything else and hurt CRE in the process as a byproduct. We simply do not know.
Now with the new revelations from the FBI, and the total disgust of everyone with the both candidates, it is clearly too close to call. Personally I am betting Trump now wins because the corruption of the Clintons in my view will cause voters to stay home who may have voted for her, and will get more Republicans to come out to vote than would have, just to keep her and Bill away from the White House. However, whatever the vote, it is possible that due to Utah and the third party candidates, this could go to the House of Representatives for a decision. Recounts are surely possible. I guess anything is now possible.
It is inconceivable that FBI director James Comey does not already have some real evidence from the Abedin emails, or he never would have done this. He cannot come back later in the week and say we found nothing. He will be hung. His agents were already reading what was on that computer, and stumbled on whatever they found, and so the FBI has at least some strong preliminary indication, there is something real, and now they can put extreme pressure on Abedin to spill the beans.
The story behind the scenes is that this all stemmed from the custody fight between her estranged husband Anthony Weiner and Abedin, with his lawyer telling her lawyer that if she did not allow custody he had damning information. Her lawyer did not believe that, so Weiner's lawyer took it to the FBI. There is no way to know if that story is true, but it is feasible. If she is indicted she will not get custody, and the kid will go to a relative. If true, the FBI has a huge added pressure point on her.
So for CRE it is probably best to sit tight for a bit to see where all this goes. There is just a week left, and in this week there has to be something more from the FBI than we are still investigating. By using search programs and duplicate elimination, they likely can get back to a much smaller number to read, and then can assign teams of agents to review quickly to sort out the critical ones in a couple of days. There is also a good chance Wikileaks has much more to reveal and that will pile on the FBI investigation. Trump is now about even all of a sudden. So buckle up because this is going to be truly unprecedented. If Trump wins, then we will need to wait until spring to know how bad he really is, or not. A lot depends on who controls the Senate, and my guess is the Republicans hang on. If they do, then a lot of changes can happen, although, whether for good or bad is unclear.
Joel Ross is Principal at Citadel Realty Advisors. The views expressed here are the author's own.
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Joel Ross
Joel Ross began his career in Wall St as an investment banker in 1965, handling corporate advisory matters for a variety of clients. During the seventies he was CEO of North American operations for a UK based conglomerate, and sat on the parent company board. In 1981, he began his own firm handling leveraged buyouts, investment banking and real estate financing. In 1984 Ross began providing investment banking services and arranging financing for real estate transactions with his own firm, Ross Properties, Inc. In 1993 Ross and a partner, Lexington Mortgage, created the first Wall St hotel CMBS program in conjunction with Nomura. They went on to develop a similar CMBS program for another major Wall St investment bank and for five leading hotel companies. Lexington, in partnership with Mr. Ross established a hotel mortgage bank table funded by an investment bank, and making all CMBS hotel loans on their behalf. In 1999 he formed Citadel Realty Advisors as a successor to Ross Properties Corp., focusing on real estate investment banking in the US, UK and Paris. He has closed over $3.0 billion of financings for office, hotel, retail, land and multifamily projects. Ross is also a founder of Market Street Investors, a brownfield land development company, and has been involved in the acquisition of notes on defaulted loans and various REO assets in conjunction with several major investors. Ross was an adjunct professor in the graduate program at the NYU Hotel School. He is a member of Urban Land Institute and was a member of the leadership of his ULI council. In 1999, he conceived and co-authored with PricewaterhouseCoopers, the Hotel Mortgage Performance Report, a major study of hotel mortgage default rates.
