Are We Stuck In a Moment In Time When We Expect the Worse? “Yes, but…” Say Investors
By Mark Heschmeyer
September 26, 2012
Despite improving job numbers, rising CRE and housing prices, declining vacancies and stabilizing rental rates, not to mention a new round of fed stimulus that will pump $40 billion a month into the mortgage markets, the prevailing sentiment in the commercial real estate industry still seems to be one of doom and gloom. And importantly that outlook is affecting which deals are getting done and which ones are not.
“We have noticed the trend as well and concur that a negative, or rather extremely conservative, mindset is prevalent with the investors in the market,” said Steve Timmel, senior vice president of Colliers International in Cincinnati. “Many investors are analyzing assets based on the ‘what-could-go-wrong’ view versus spending time focusing on ‘what-could-go-right’ and this has had an impact on pricing and deal velocity.”
“We appear to be in an extended period of uncertainty that is creating a tremendous amount of gridlock,” added Ron Riley, Timmel’s counterpart with Colliers in Memphis, TN. “As the economy grinds along, it will take really positive news to start moving it forward again in a sustained fashion.”
For now, at least, the mindset of investors seems to be one of caution while the economy staggers to its feet, ignoring the positive signs of returning growth and instead expecting another knockdown punch.
“Are we stuck in a moment in time when we expect the worse,” asks Randall Chrisman, principal of The Chrisman Co. in Carrolton, TX.
His answer is: “Yes, but…”
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