LOS ANGELES—“You have to stick to your core values wheninvesting.” That is the consensus from investment panelists at arecent RealShareApartments conference here in Los Angeles.

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According to Jeff Daniels, a managing directorat AIG Global Real Estate Investment Corp., “Youcan chase yield if you like, but you will wind up tripping.” Headded that “You have to stick to your core values. Be around whereothers are building.”

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A few of the things being closely watched today by SeanBannon, managing director of Zurich AlternativeAsset Management LLC, are what is happening in other assetclasses and what is happening in hedge funds. “Our analysis of whatis happening in the marketplace begins with what happens in otherasset classes.”

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He added that “if you are underwriting a downside, you have tobe sure you are being realistic about the concessions. One thedownside, you have to look at the near term supply and renttensions there.”

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Longer term, Bannon said, “everyone is playing the same trends.We all have to be mindful of the pendulum and where it isgoing.”

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For Rodney Chu, executive director atUBS, his firm never strives to break any recordson a price per foot or price per unit. “We are seeking relativevalue.”

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UBS has been very active in the development space with itscapital generally core oriented. “Replacement costs are a keyfactor when we evaluate transactions.”

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Some of Essex Property Trust Inc. SVPAdam Berry's favorite projects right now areamenity projects, where “you have an under-amenitized building andyou are taking these garden-style deals and adding significantlyupgraded amenities.”

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At the end of the day, Berry said, “buying existing product isby definition much lower a risk scale than development… At the endof the day, it is yield vs. risk.” He added that “We look atfundamental market value, cost of capital, where we are today andproject where we think job growth will come.”

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In preparation for the RealShare Apartments event, moderatorMarc Renard, vice chairman andexecutive managing director of the capital markets group atCushman & Wakefield told GlobeSt.com that thestability in the multifamily market isattracting institutional capital.

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When asked about his take on the multifamily investment market,Renard pointed out that “the overall outlook for multifamily isvery strong, based on the recovering economic conditions and jobgrowth. Multifamily, as an asset class within commercial realestate, is viewed very favorably based on the merits ofmultifamily, which are viewed as less volatile than other propertytypes. Multifamily prices like a fixed income and therefore isintriguing to institutional capital, which are looking to mitigaterisk.”

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As for what geographic areas investors are finding the mostopportunities, Renard pointed to the gateway cities, which would beLos Angeles, San Francisco, Seattle, Boston and New York, and asinvestors' appetite for risk has increased, he noted that “you haveseen the geographic locations where they will invest expand ascapital searches for incremental yield. This trend is prevalent inthe marketplace now.”

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Natalie Dolce

Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.