A 7-PART SERIES ON WHAT EXPERTS PREDICT FOR REAL ESTATE IN 2021
Part 1- Should we be leaning into these headwinds, or should we retreat to the sidelines?
2020 has been an unforgettable year. Yes, all of us have other adjectives we can use to describe their own personal 2020 experience, but for purposes of this article we will use the word ‘unforgettable!’
An economy that started the year at record-setting levels, and then saw some of the most violent shifts in unemployment, swings in revenues at both a corporate and personal level, and personal wealth. 401k’s which were tied to the US Stock market saw record highs, a rapid decline, and then one of the most dramatic recoveries ever witnessed in their lifetime.
And then, there was the 2020 election cycle from Hell that many would like to simply forget. An election which was filled with some of the most polarizing platforms, debates and campaign strategies which caused some interesting political debates at the office, around families and the never-ending news cycles of cable TV.
Well, everyone has cast their vote. All the votes have been counted. Election lawsuits are soon to be over. And just like that, the 2020 Presidential election is finally over. And with it, the unforgettable year of 2020 will be in the history books.
But what does a Biden – Harris Administration mean for the future of real estate development, construction, investing and ownership in the 4th largest city in the United States? What does a near-term roll out of a COVID-19 vaccine mean for our health, consumer confidence and ability to get back to the life that we once knew?
To understand what the industry experts crystal ball may predict, a strategy discussion was held with some of the most experienced and knowledgeable real estate experts in the world. The cerebral panel covered topics such as capital markets, the economy, construction costs, development trends, effects of COVID, regulatory matters, and much more.
This article is the first in a series of seven segments broken into bite-size topics and incorporate the insight of executives from MarketSpace Capital, the Structured Finance Group of Transwestern Real Estate Services, McVey & Associates and Madison Commercial Real Estate Services. In short, given the current landscape and forecasted trends related to the economic, political, banking, healthcare, and real estate sectors, many real estate investor are asking the question should they be leaning into these headwinds, or should they be retreating to the sidelines?
To find out the details, continue reading each of this 7-part series. However, here is a summary of what the experts had to say.
Should we lean in or retreat? The consensus of the Panel
No matter how divided a society may be, a balance of power in government generally indicates that future policy will remain in line with current policies, despite overtures of change. Furthermore, population counts continue to grow. And last time we checked, no one has made more land! So well-placed real estate, like gold, is in finite supply and always a great long-term investment.
We are at a point that a savvy investor could capitalize on all markets, especially when focusing on foreclosures with solid property fundamentals (hotel, office, retail, all opportunities with quality product). Yet, to summarize real estate is always a good play despite the stock market, president, or parliament. We will feel pain in the short term due to the pandemic, that will translate through to Commercial Real Estate, but long-term fundamentals for core locations is sound. As an investor, this is the time to pounce. As a property owner, this is the time to hold. As a property owner on the edge this is the time to refinance and benefit from some of the historical low cost of capital.
Panel of Experts
Sam Herskovits, Executive Vice President at Madison Commercial Real Estate Services
Honorable Marty McVey, McVey & Associates and Financial Advisor to Hwami Builders
Masaki Oishi, Co-founder and Chairman – MarketSpace Capital
Jan Sparks, Executive Managing Director Structured Finance, Transwestern Real Estate Services
MarketSpace Capital, LLC is a Houston, Texas-based private equity real estate development firm focused on ground up developments and value-add investments throughout the United States.
Disclaimer: *For sold properties, actual sales price is reported. For active investments, the Estimated Current Value is based on the Managing Member’s estimate of current value. Recent acquisitions are generally valued at the acquisition price. Values may be internally prepared. This web-page/website is for informational purposes only and is qualified in its entirety by reference to the Confidential Private Placement Memorandum (as modified or supplemented from time to time, the “Memorandum”) of any offering of MarketSpace Capital.