Minority Report

As we prep for 2013, the watchword remains “caution,” even as the economy (and therefore commercial real estate) travels its sluggish path to recovery. This year’s Emerging Trends, the annual opus of ULI and PwC, said it best: “As investors tentatively advance further along the risk spectrum in 2013 chasing yield, they suffer queasiness about the limitations of US real estate markets. There is just not enough product to get the yields they want.” Add to this slow-to-improve fundamentals and lingering concern that Europe’s fiscal crisis could waft this way, and the challenges facing would-be sellers of product comes into stark relief.

It’s particularly angst-inducing for minority stakeholders, the players who have just a piece of the action and are waiting on the major owners to determine their strategy. In such fractional—and sometimes fractious—ownership situations, the underlying investors, who thought their payoff was finally at hand, are being told to hold their water for another few years.