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 Is the bottom of the market approaching? Is it already there, and we have been submerged for too long to avoid the effects of the storm, and for too long we have been drifting just off the bottom without realizing we could navigate to improved waters? As the residential market preceded the commercial market decline, it now seems evident that the residential market, in all but the most depressed locations, is evidencing an uptick in the sales of existing homes. What does this mean? It is in my viewpoint the first and necessary step of infusing some money into the…

  I recently attended a conference where a speaker offered his theory for the cause and severity of the current financial meltdown. He said, “The ‘fuel’ for the downturn was a huge savings glut that required investment and the “oxygen” was a systemic ignorance of risk.” This is not a new story, but the size, scope and number of businesses and asset classes impacted has been far greater than previous ones. Margins and returns were razor thin and 30-1 leverage was utilized by some for purchase of assets. Investment decisions were based on the notion that values had almost no…

  Many of us have jumped through hoops to meet a residential landlord’s demands prior to renting an apartment. Before you even have a key in hand, you’ve already shelled out thousands of dollars in the form of credit check and application fees, a security deposit, up-front rental payments, even background check fees. All of this in the name of due diligence. With the commercial real estate industry and broader business world intently focused on what landlords are doing to lure and retain tenants in today’s economy, it’s time for commercial asset owners to get aggressive in requesting tenant guarantees…

The growth and development of India’s emerging economy in recent years has been of great interest to me. India’s dynamic energy and vibrant culture, combined with the new economy, present a singular opportunity for retail development. Fashion week, Bollywood, and international designers are all converging in a market that, according to a joint study by ASSOCHAM and KPMG, expects US $25-30 Billion investment in modern retail formats over the next 4-5 years.  I am hearing s parks of optimism spreading across many markets over the past few weeks – from our clients and friends in New York, Paris, Moscow, Shanghai, Dubai,…

  Properties aren’t the only thing falling into distress these days. Private buyers, whose higher yield requirements left them on the sidelines during the 2004-08 run-up, see opportunity in distressed assets and are eager to purchase. Unlike the early 1990’s, however, when banks and the FDIC sold many single assets as well as bulk real estate portfolios, the abundance of distressed product has yet to surface. The current lack of “troubled” properties originally expected by potential buyers, is a function of several factors: significant foreclosures in many parts of the country have yet to occur, banks are more patient and…

  Where were you when the music stopped? More hard lessons are being learned every day in our industry about the risk of high leverage short term debt. As tempting as it is in good times to leverage development and acquisition activity with short term lines and other high leverage debt, the price can be very high in a downturn. Commercial real estate and short term exit/finance strategies are not a good match. NorthMarq Capital’s mortgage servicing portfolio of $37 billion is comprised largely of fixed rate transaction based financing with staggered maturities. Even our shorter term financings that we…

  While experience can certainly be an asset, it is not at all uncommon for it to be a severe hindrance. While I’m not prone to stereotyping, it has been my observation that there are generally two types of people: those who don’t know what they don’t know, and those who do know what they don’t know. All other things being equal, the difference between the two groups boils down to experience and discernment. Those people who don’t know what they don’t know typically tend to be either younger professionals beginning their careers who have a lack of experience, or…

  Much has been reported lately about downtown Miami’s challenges absorbing the influx of residential development that has taken shape in recent years. To examine where Miami stands today and how it will move forward, it’s helpful to take a step back. The latest wave of urban growth began in the late 90s, when Miami’s civic and business leaders saw sustainable vertical development in our urban core as the logical place to begin expanding the City. We’re neighbored by the Everglades to the west, the Atlantic Ocean to the east, and we sit atop our own drinking water, so condensed…

  Wikipedia explains “the doldrums” as a reference to being in a state of listlessness, despondency, inactivity, stagnation, or a slump. Sound familiar? It surely is representative of our economy and the last six months in Chicago Metro real estate. I would hazard to guess that most of our existing, or potential new clients, have felt just like the sailors of old, stranded in a calm, waiting for the winds of change to rise once again, so they can begin to see the skies clear, and offer a glimpse of hope to guide them back on course. There are signs…