"You should expect to put more equity into your deals, youshould expect to pay a higher price and you should expect to seerecourse again," says Robert Stone, senior vice president ofDallas-based Guaranty Bank. "All real estate deals need a reason,and all real estate deals need to have a story."

Stone's bank is a construction lender, and it expects to do some"hand-holding," though not many work-outs or restructurings, as therecession lengthens.

The downturn in the economy is a fact of life that must beaccepted by those in the real estate business, says GE Capitalmanaging director Frank Marro. "Sellers were in denial that we werein a downturn," says Marro, admitting his firm was among them."Over the next 12 months, people have to admit we're in an economicdownturn. But we're excited about that."

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