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SAN DIEGO, CA-Real estate investors and developers have more reasons to feel optimistic than they have to worry, but a few clouds do loom on the horizon in some markets, Susan Hudson-Wilson of independent research and advisory firm Property & Portfolio Research Inc. told an audience here Thursday at the 2004 NAIOP annual conference. Hudson-Wilson, founder and CEO of Property & Portfolio, delivered a generally upbeat assessments of the office, industrial and retail property markets, but she cautioned against the multifamily market’s trend toward condominium construction, saying it can’t continue unabated.Hudson-Wilson told the NAIOP members that they need to be aware of what’s happening in all property sectors, even those in which they are not investing, because “You have to compete with retail and apartments for your money.” She listed a host of economic signs that bode well for the industry, including increasing job growth, high productivity, gross domestic product growth, low interest rates and low employment. That list outnumbers the list of causes for worry, she said, but she pointed out a shorter list of causes for concern, including job growth has been slower than required to absorb new workers entering the labor force, the rising national deficit, mounting consumer debt, and the prospect that consumer spending that may wane. Capital will remain plentiful for real estate, she said, because it continues to outperform other investment options.In a wide-ranging discussion of specific property types, Hudson-Wilson described office, industrial and retail properties as good performers but warned against the “withering cash flows and rising prices” in the apartment market that have prompted many investors to develop condominiums in search of higher returns. The rush toward condominiums, she said, has “protracted the bust in the apartment market, but the bust will come.”Hudson-Wilson was one of a number of keynote speakers at the NAIOP conference, which began Tuesday and runs through today (Friday). Approximately 850 attendees registered for the San Diego event, which includes a host of presentations and panels on real estate investment and development topics covering every facet of the industry.Sponsors of the conference sponsors include Real Estate Media Inc., the parent of GlobeSt.com, Real Estate Forum magazine and other industry print and online publications and services.

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