CPN - December 2008 - (Page 13)

CONFERENCES MARKET INTELLIGENCE Tough Love as Gotham Regroups T he experts who spoke at CPN’s New York Investment conference last month were in no mood to hand out sugarcoated messages. Instead, they presented a realistic view of the nation’s largest commercial real estate market. One worrisome statistic surfaced repeatedly: 165,000 New Yorkers are expected to lose their jobs, and the city has yet to feel the brunt of it, noted Eastern Consolidated chief economist Barbara Byrne Denham. At the same time, industry veterans made it clear that historical perspective is in order. If Denham’s projections hold true, the job losses would actually be the fewest tallied by the city during any of the four post-World War II recessions. Kent Swig, cochairman & owner of Terra Holdings Inc. and president of Swig Equities L.L.C., framed the market’s outlook further. “It’s not a rosy picture. It’s just a factual basis on which to say, ‘How deep is the recession and how long will it take us (to recover)?’” As financial services firms and other Manhattan stalwarts return space to the market, rents will fall from the record-setting levels set in 2006 and 2007, noted David Arena, president of Grubb & Ellis Co.’s New York City office and the winner of a debate featured at the conference. Hedge funds set the upper limits of Manhattan office rents, paying as much as $200 per square foot in ’06 and ’07, but many funds are now reducing their footprint. Still,Arena called attention to a nuance: “While they pay a lot, they don’t take much space.” For investors, too, the downturn has served as a reminder that even Manhattan must obey the laws of gravity.“Eighteen months ago, when an investor acquired a building in New York, the assumption was that rents would increase indefinitely,” explained Thomas Beneville,managing director & head of the New York City capital markets group for Jones Lang LaSalle Inc. Still, in his opening keynote address,Real Capital Analyt- Opening keynote speaker Robert White Jr. (at left) and “Capital Markets & Investment: Changing Times, New Rules” moderator Jahn Brodwin (at right) and panelists Dennis Yeskey, Michael Katz, Thomas Beneville and Richard Bassuk ics Inc. founder & president Robert White Jr. identified at least one national trend that seems to favor New York City’s investment forecast.“The major markets are doing far better than the secondary and tertiary markets,” he noted. And even now, corporations around the world consider a presence in New York City a must, noted Jahn Brodwin, senior managing director for The Schonbraun McCann Group. Panelists also offered encouraging words about the real estate markets in the rest of the tri-state region. During the next several years, the region’s population will grow three times as fast as the average rate for the United States, reported Terry Munoz, vice president & practice leader of retail, restaurant and real estate for Nielsen Claritas. Munoz contended that broadbased population growth bodes well, but the trend also poses challenges to the area’s transportation infrastructure and residential capacity. —Paul Rosta, with reporting by Eugene Gilligan $ 66,100,000 $ 27,900,000 THE NYU SCHACK INSTITUTE OF REAL ESTATE Direct Equity Multifamily – Houston, TX Whole Loan Acquisition Industrial – Grand Rapids, MI $ 25,000,000 $ 15,100,000 It’s not about predicting a market change. It’s about preparing for it. B-Note Acquisition Residential – Bellevue, WA Whole Loan Acquisition Multifamily – Reno, NV MASTER’S IN REAL ESTATE The real estate market will change numerous times over the course of a career. The challenges of the current environment underscore not only the importance of understanding the cyclical nature of the business, but also the level of expertise required to succeed—regardless of which way the market is headed. Over the last 40 years, the NYU Schack Institute of Real Estate has become the industry’s most respected institution of higher learning. The Master of Science in Real Estate integrates theory with real-world application in all phases of the real estate deal. Our faculty consists of leading industry authorities, hands-on experts who will provide you with the insight and perspective to keep you at the forefront of this dynamic field. $ 19,000,000 $ 29,500,000 Whole Loan Acquisition Multifamily– Houston, TX Direct Equity Medical Office – Gilbert, AZ Spencer Garfield • sgarfield@hudsoncap.com Tel. 212-532-3553, ext. 263 • Fax 212-532-7901 Information Session: Wednesday, December 17, 6–8 p.m. Grand Hyatt, Conference Level, Park Ave. (at Grand Central) Please call to RSVP. 250 Park Avenue South, Third Floor • New York, NY 10003 www.hudsonrealtycapital.com scps.nyu.edu/360 1-888-998-7204, ext.360 New York University is an afﬁrmative action/equal opportunity institution. ©2008 New York University School of Continuing and Professional Studies www.cpnonline.com • December 2008 • Commercial Property News 13 http://www.hudsonrealtycapital.com http://www.hudsonrealtycapital.com http://scps.nyu.edu/360 http://scps.nyu.edu/360 http://www.hudsonrealtycapital.com http://www.cpnonline.com

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CPN - December 2008 Contents Starting Line Retail Data/Analysis Conferences Boston Market Profile Finance International Property Management

CPN - December 2008

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