Tsunami

The most pressing question I am asked by clients, buyers, sellers, brokers at meetings or presentations is “Where is the supply”. Heck at my own company they are looking at why business in the commercial sector is slow and why they should concentrate on it. On December 26, 2004 in the country of Indonesia and Thailand video reminder embedded people were in awe as the water flowed away from the shore line and they could not figure out what was happening. Sound familiar to today’s commercial real estate market? Buyers want to buy low, sellers want to sell high, lenders want your first born and a gallon of blood to lend on your CRE project and there seems to be no movement in the distressed marketplace. So we all stand there second guessing ourselves as to why in the heck we are even in this business.

At the end of last year momentum picked up and we thought “ah here we go” but that was short lived as investors sold properties and buyers bought properties quickly to realign their investment toward a different strategy or tax purposes. Start this year 2010 would be the year for banks to dispose of their “Shadow inventory for sure”. I mean assets were supposed to come to the market last year, right? So we all sat and watched the water being pulled out to sea. Companies laying off because they had great 4th quarter earnings but the months since have shown little in the way of expanding. Enter today as we sit and question what is happening. Recall previous video when there is an enormous amount of energy pent up whether a wave or financial back up eventually see here.

If you are questioning join the crowd. My business partner Warren Samek has a contact at the FDIC and has indicated come hell or high water, no pun intended, the wall of water is coming this year. Activity levels at the FDIC and with contractors supports that theory however it will it be a few more weeks before you see the impact. Right now you get to look into the ocean and see that big wave coming and wonder what you are going to do with your investments when it hits. Prepare and as the saying goes if everyone else is zigging you zag and right now almost everyone is looking for the activity and missing the big wave about to hit you square in the teeth.

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