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HOME > Marketplace Reflections > issue 122
"Every leaf speaks bliss to me, Marketplace Reflections: Issue 122We hope you enjoy this issue of Marketplace Reflections. Dudley & Associates has been engaged in Executive Search and Recruiting since 1983. Our web site is www.dudleyandassoc.com. The phone number is (972) 265-7915. ANNOUNCEMENTSOPPORTUNITIES322 S Equity Raising Professionals(Dallas)Our Dallas based client is a diversified commercial real estate firm who has successfully completed $1BB+ of deals during their history. They have recently raised $150MM for an opportunity fund and are currently raising an additional $750MM to invest in distressed and value added real estate. D&A is leading the effort to hire an equity raising team, to call on both institutional and private investors for this new fund. If you have a background in raising capital from pension funds, endowments, wealth managers, or directly with high net worth investors, this opportunity may be for you. This team will raise money for this fund and future funds, making these permanent positions. Salary and commissions/bonuses will be commensurate with experience. Contact Sayres Dudley at asdudley@dudleyandassoc.comMEETINGSRealShare Apartments 2009October 8, 2009 Westin Bonaventure Hotel, Los Angeles For more information, go to http://www.almevents.com/conf_page.cfm?instance_id=28&web_id=1191&pid=802 TREC Giving Gala October 8, 2008 Anatole Sculpture Park For more information, go to http://www.recouncil.com/txdalcnl/web.nsf/doc/meetings_fallgala.cm NAIOP Development '09: The Annual Meeting for Commercial Real Estate October 14-16, 2009 Sheraton Chicago Hotel & Towers For more information, please go to http://www.naiop.org/conferences/development09/index.cfm ArticlePREVIOUS ISSUES 300+ people crowded into the Adolphus Hotel in Dallas Tuesday to hear from experts on the current state of affairs in commercial real estate. As usual, RealShare brought together outstanding panelists from a variety of disciplines, to help the audience understand and possibly predict where the market is going. This report will give a synopsis of the conference, but for a more complete overview, www.globest.com has compiled two articles on their site for your review. Mark Grinis from Ernst & Young began the day by outlining the amount of distress. Mark reminded us our unemployment rate has already passed the last recession, and delinquencies should end about the same as the last cycle. With a 54% debt to GDP, higher interest rates are simply a matter of time. With the home equity “elixir” no longer available to the consumer economy, spending will drag , retail will suffer, and home prices will bottom soon. Mark explained that 41% of CRE debt will mature in the next 3 years, and by 2013, it will total over $1.1TT. Robert White from Real Capital Analytics followed. Across the board, prices are off 37% from peak, and any deals done after 2004 are probably at or below current purchase prices. $135BB in commercial mortgages have defaulted to date, and $10BB are coming into the distressed market each month, with CMBS leading that trend. Insurance companies have very little distress in their portfolios. Commercial mortgage sales and CMBS sales through the FDIC are averaging about 40-41 cents on the dollar. He emphasized that domestic sales are increasing, international sales even more, but that pricing is not. There were lots of panels, with lively and informative discussions. A couple of noteworthy statements: from Bob Knakel of Massey Knakel, “REITs could become a dominant player in the debt market because of their access to public capital,” and from Jon Barry of Colliers Asset Resolution Team, “CRE, in comparison with other economic woes in the economy, credit cards, unemployment, Treasury debt, is not getting the same attention. As a result, banks who get stimulus money have less motivation to move anything.” For brevity though, this report will concentrate on the Special Servicers panel, because they clearly garnered the most attention from the audience. Special Services panel was moderated by Steve Pumper of Transwestern, and included Kevin Donahue at Midland Loan Services, John Hamilton of Pyramid Hotels, Michael Carp with Capmark, Brian Pittard with Trimont, and Robert Flandrau with CW Capital. Steve stated that special servicers could be handling $100BB in loans by year end. Michael said that many operators are simply handing back the keys instead of holding the assets. Kevin said their portfolio was growing from $3BB in 2008 to possibly $10BB by year end, with 80% of that $10BB originating between 2005-2007. The panel agreed that most 5-7 year loans maturing in the near future will not have traditional refinancing options, so borrowers will face a re-pricing of their assets. One final note from the Appraisal Panel, which included Everett Greer of Greer Advisors, and Patrick Duffy of Colliers Appelt Womack. Both men had very good power point slides for their presentations, and those slides are available for your review here http://www.almevents.com/conf_page.cfm?pt=includes/webpages/webwysiwyg.cfm&web_page_id=10229&web_id=1209&instance_id=28&pid=822 Have a great day, Kathy & Sayres Dudley Dudley & Associates 6860 N. Dallas Parkway, Suite 200 Plano, TX 75024 Phone 972.265.7915 Fax 972.265.7916 www.dudleyandassoc.com Copyright © Dudley & Associates 2009 All Rights Reserved
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