Is Now the Time for Action?

LOS ANGELES-In one of our recent weekly company strategy meetings, one of my colleagues shared a conversation with his friend, the head of a major institutional real estate investment firm. My colleague asked, “What would you have done differently over the past several years?” His friend’s thoughtful reply was, “I would have bought every deal that I passed on!”

Certainly hindsight is 20/20, but this reflective observation from an investment-manager underscores a call to action for US commercial real estate investors over the next several years. The US commercial real estate markets are prime ground for new investments in the immediate future.  Liquidity has returned, most markets are moving toward balanced supply and demand, and commercial real estate still offers attractive returns relative to alternative fixed income investments. Certainly the low-hanging fruit has been picked, but savvy investors will find that the next several years will offer rewards for well researched and well executed acquisitions. Let’s take a closer look at a few of the relevant trends supporting this thesis: