Last night a bunch of former colleagues informally got togetherat a Grand Central watering hole to catch up. Most people seem tobe doing well, maybe there was a bit more passing of business cardsthan normal. "It's time to keep your head down and work hard,"someone said over the din and a beer.
Everybody expects performance to head south and there was somereminiscing about how pension fund advisors used to manage andmassage returns on the way down in core real estate accounts --avoiding anything too precipitous. One manager I knew of a decadeago had a bunch of bad properties with few good prospects --somehow inevitable writedowns came in measured increments over sixor seven quarters rather than all at once. The advisor apparentlywanted to avoid the consultants' "penalty box" or rouseclients' to withdraw or stop investing. Is that happeningagain? NCREIF returns are falling, but we still see appreciationregistering despite cap rate decompression and softeningfundamentals. There were a few wink-winks among the group at thebar.
Another former colleague in the fund management business said hehas bluntly told portfolio managers at his company to be verycareful in today's environment: "One thing you don't want is to bethe last firm taking writedowns -- that will start to raise a lotof questions that you don't want to answer."
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Jonathan D. Miller
A marketing communication strategist who turned to real estate analysis, Jonathan D. Miller is a foremost interpreter of 21st citistate futures – cities and suburbs alike – seen through the lens of lifestyles and market realities. For more than 20 years (1992-2013), Miller authored Emerging Trends in Real Estate, the leading commercial real estate industry outlook report, published annually by PricewaterhouseCoopers and the Urban Land Institute (ULI). He has lectures frequently on trends in real estate, including the future of America's major 24-hour urban centers and sprawling suburbs. He also has been author of ULI’s annual forecasts on infrastructure and its What’s Next? series of forecasts. On a weekly basis, he writes the Trendczar blog for GlobeStreet.com, the real estate news website. Outside his published forecasting work, Miller is a prominent communications/institutional investor-marketing strategist and partner in Miller Ryan LLC, helping corporate clients develop and execute branding and communications programs. He led the re-branding of GMAC Commercial Mortgage to Capmark Financial Group Inc. and he was part of the management team that helped build Equitable Real Estate Investment Management, Inc. (subsequently Lend Lease Real Estate Investments, Inc.) into the leading real estate advisor to pension funds and other real institutional investors. He joined the Equitable Life Assurance Society of the U.S. in 1981, moving to Equitable Real Estate in 1984 as head of Corporate/Marketing Communications. In the 1980's he managed relations for several of the country's most prominent real estate developments including New York's Trump Tower and the Equitable Center. Earlier in his career, Miller was a reporter for Gannett Newspapers. He is a member of the Citistates Group and a board member of NYC Outward Bound Schools and the Center for Employment Opportunities.
