Real Estate is Still the Darling

Real Estate is Still the Darling
By: Nicholas A. Dunlap

Touted by many financial publications as a “quarter to forget”, the Stock Market has continued it’s downward, depressing trend. All the talk of Greece, the Eurozone and bailouts and these dark undertones are starting to resonate in our own American Economy with our increasing unemployment figures, new consumer credit crunch, and of course: our lack of leadership through such bleak times. And yet, those of us who own and operate investment real estate have not been busier or better in recent years. At our firm, we had our best Summer since 2007. We saw rent increases at most B properties in B or better areas and have seen our occupancy continue to trend higher. That said, it is no wonder that this week the Wall Street Journal and Money Magazine both began to hype up the REIT or Real Estate Investment Trust. In fact, WSJ published an article today titled “REITs, Don’t Fail Me Know”, virtually acknowledging the hold of Real Estate through REITs as one of the superior investments available in the marketplace today.

Why wouldn’t it be? Interest rates are low, rental income rates are on the rise and there are still a number of distressed opportunities available in the marketplace. Sophisticated investors are killing it in this “perfect storm” of sorts. My opinion? Don’t go for the REIT, align yourself with a fund or syndication sponsor and identify the opportunities that best suit you. Not only is the time right, you can achieve the four benefits of owning commercial real estate.