Wednesday, February 4, 2009

The Only Thing Constant is Change in Real Estate

‘The only thing constant is change.’

This concept formulated by Heraclitus around 500 BC couldn’t describe the cyclical nature of the real estate industry any better. And where there is change, there is opportunity. 2009 will be a difficult year for the commercial real estate business with major industry players feeling the pinch as they try to reposition themselves for the new playing field unfolding.
Many predict the commercial real estate market will
not stabilize till around 2011.
In this time of uncertainty, there will be a need for eager and tenacious real estate professionals to chart the path of change. Areas of growth in the near future will include: taking over and managing distressed portfolios; public-private partnerships focusing on rehabilitating the nations infrastructure system; senior housing; and green building, which in the near term is likely to focus on rehabbing aging buildings with insufficient energy standards.
With the onset of a new administration taking office, and a feeling that the government will need to lead the Country out of the recession, public infrastructure projects will likely be the most prominent activity in the real estate sector. President Obama has announced that he is ready to fund “shovel ready” infrastructure projects which will lead to the creation of new jobs.
In general, the opportunities will be with the companies that work with lenders and government agencies. This is a time to “follow the government money”, because job expansion will be tied to public sector investment and funding.
In addition to being cyclical, real estate is an industry based on connections. With that in mind, there is no better in time to get involved with real estate industry groups like ULI and ICSC. These organizations provide great insight on industry trends as well as offering networking events creating the opportunity to meet leading professionals in your area.
Larry Kosmont, Founder and CEO of the Kosmont Companies.
Patty DeDominic shared a leadership class with Larry about 20 years ago and we are both committed community volunteers.
Kosmont Companies is a development services firm offering a full range of real estate and economic advisory, brokerage, project finance, investment, and planning services for both the public and private sectors. Founded in 1986, Kosmont Companies is a nationally recognized expert in economic development and real estate development projects involving government and private sector partnerships.


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