In the Keynote discussion, Leslie Himmel and Stephen Meringoff of Himmel + Meringoff Properties shared their success in the office market, discussed leasing development and the future of the market.
In the Past:
• The 1990s were tough times to maintain portfolios but it helped make investors stronger.
• Since 2005, building sales have been on a “roller coaster ride”, the bottom being 2007.
• In the past, building information was much harder to obtain but technology has made information more transparent.
The Current State:
• Robert Knakal (Chairman, Massey Knakal) predicts building sales will be down this year in NYC compared to last year.
• There were more buildings sold in Q4 in 2012 than any other period in NYC due to a foreseeable increase in capital gain taxes.
• Tax policy affects behavior with investment sales
• Building values will increase this year due to supply and demand
• Important factors that will influence the market in 2013: supply, demand, interest rates, jobs and the NYC mayoral race.
• Stephen Meringoff (Co-Managing Partner, Himmel + Meringoff) says “There really aren’t any bad markets in NYC”, however, “without leverage, real estate is a mediocre asset class”.
Borrowers Brawl
In the Borrowers Brawl, senior executives discussed the inherent conflicts and mutual interests between CRE borrowers and lenders.
• Low interest rates have afforded building owners to carry loans through tough times.
• There are restructuring options available for borrowers that can help mitigate risk.
• Borrowers that aren’t solving their problems could be because lenders won’t listen or assets aren’t performing.
Technology in Real Estate
Panel discussions also weighed in on how technology is affecting the industry. As more tech and media companies move into New York, they seek spaces which offer more open space, less space per employee and higher reliance on technology within their spaces – which affects how new offices are designed and maintained.
You can find out more about the annual CRE Investment Summit on Massey Knakel's website.
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