As we enter 2015 with the wind at our backs in the investment sales market, it seems like a good time to consider the supply/demand dynamics currently driving the industry.
The most important metric for the market is supply. In the 31 years I’ve been a broker in New York City, supply exceeded demand only once, in 1992. That year, the Resolution Trust Corporation dumped hundreds of distressed properties from failed banks. Back then, the few investors who had money were hard-pressed to spend it on commercial real estate. Values at the time were about 70 percent lower than they were at the top of the market in 1988. By comparison, the 38 percent drop in values from 2007 to 2010 was little more than a speed bump. Read More