BEVERLY HILLS, CA-Southern California apartments still look like a good place to put money, especially compared to other investments and apartments in other parts of the country, but a quirky economy and other uncertainties cloud the picture for investors. These were some of the conclusions of speakers at an all-day conference called “Apartments 2002″ last week in Beverly Hills.

Speakers, who ranged from brokers and investment advisors to REIT executives and lenders, pointed out that Southern California apartment markets remain among the tops in the nation in terms of supply versus demand because of the region’s housing shortage. But they pointed out that rent growth has slowed, cap rates have declined, vacancy rates have edged up, and the modest economic recovery has occurred without much job growth, which is essential for a sustained recovery.

Several speakers referred to the “jobless recovery” and said job growth is essential in order to drive demand for apartments. “The key for the apartment sector is increasing jobs,” said Mark Obrinsky, chief economist for the National Multi Housing Council.

A number of speakers said apartments will remain an appealing investment as long as the stock market is depressed and other investments are performing poorly, but they cautioned that investors could quickly pull money from apartments and place it elsewhere if the economy recovers, interest rates rise, and other investments look more profitable. Other speakers mentioned the possibility of war with Iraq, or other international political developments, as factors that could disrupt investment markets.

Despite weakness in a number of apartment markets throughout the country, Southern California’s apartment markets are out-performing many others, according to Harvey Green, president and CEO of Marcus & Millichap, who said the region’s apartment markets remain within the top 10 in the country in terms of supply versus demand.

Among the event’s featured speakers were Peter Kompaniez of Denver-based AIMCO, an apartment REIT; builder Alex G. Spanos of Stockton, Calif.-based A.G. Spanos Cos.; Richard Burns, principal of Lend Lease Real Estate Investments; Jason J. Coughenour, a director of the US Department of Housing and Urban Development; Max L. Gardner, president of Irvine Apartment Communities; Heidi McKibben, Fannie Mae’s top Western multifamily executive; and Thomas K. Bannon, EVP of the California Apartment Association.

Panels throughout the day addressed REITS, brokerage, development, financing, investment trends and other apartment industry topics. The day-long conference was sponsored by many multifamily firms as well as and two of its sister print publications, Los Angeles-based Real Estate Southern California and the national Real Estate Forum.

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