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Are we in a correction? How long is it going to last?

EisnerAmper Real Estate Private Equity Summit panelists discuss whether the market is in a period of correction, and what’s ahead for vacancies and pricing.


Transcript

Kenneth Weissenberg: We've heard from various people throughout the day as to what their view of the market is. Some are more optimistic, someone more pessimistic. Are we in a correction? And if we are, how long do you think it's going to last?

Jonathan Kaufman Iger: I wouldn't call it exactly a correction. I think what we're starting to see and what we would hope to see in the next 12 to 18 months is a reversion back to what we call traditional underwriting. That the properties that we've been trying to compete for the investment level in New York, whether it's core or value add, you're competing against investors who are not using traditional underwriting techniques. They're looking at these assets as a flight to safety for capital. You're seeing Canadian pension funds who are happy to underwrite to a three percent cash on cash return, completely unlevered. That's not a playground that we can play in. But I think some of that capital is starting to dry up while there's still a tremendous amount of capital on the sidelines to be deployed. So we have a very positive outlook on the market. We're just kind of waiting for that complete reversion to occur to jump back in.


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Kenneth Weissenberg CPA, Tax Partner in Real Estate Services, is experienced in tax saving strategies and negotiating sales and acquisitions. He represents owners of some of the most well-known real estate properties in New York City.

About Lisa Knee

Lisa Knee is a Tax Partner with expertise in the hotel, real estate, financial services, aviation and restaurant sectors and is a member of AICPA, New York State Society of Certified Public Accountants and the New York State Bar Association.

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