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WASHINGTON, DC-The Greater Washington area’s real estate markets are without a doubt some of the strongest in the country. However, there are small signs of slowing growth that bear watching, according to some of the participants at the RealShare Washington event, held at the Renaissance Mayflower Hotel Wednesday.

While almost every speaker at the event lauded the strong fundamentals of the Washington, DC area’s real estate markets and projected a strong 2007, Bernard Haddigan, managing director of Marcus & Millichap, noted that there are signs of weakness is some class B and C assets in a few submarkets.

“The best asset classes have cap rates that are lower than what they were a few years ago,” he said. In some cases secondary assets, though, have seen cap rates rise several basis points. Marcus & Millichap, he said, is marketing some of these properties that have gone into foreclosure. “On the low end of the market the signs of [trouble] are there.”

Most of the concerns expressed were couched in terms of slowing growth. Patrick Marr, EVP of CB Richard Ellis, does not believe a rent increase will reach 20%. “There is already a difference in the asking rates and actual rents received.”

Such concerns, though, dwarf the market’s overall growth, participants have also said. Capital is still very interested in the DC market and is willing to compete for the better assets, according to Bob Murphy, managing principal of MRP Realty.

More than 600 industry professionals, a record for the DC event, gathered to hear the outlook. The RealShare Conference series is presented by Real Estate Media, publishers of GlobeSt.com, Real Estate Forum, and a range of regional magazines and newsletters.

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