Magazine article Journal of Property Management

Market Mistrust Leads Investors to Real Estate

Magazine article Journal of Property Management

Market Mistrust Leads Investors to Real Estate

Article excerpt

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While the current real estate investment environment is anything but dear sailing, new independent research conducted by Real Estate Research Corporation (RERC) indicates investors find real estate appealing due to falling stock prices and lack of investor trust in the financial markets.

The availability of capital, both for debt and equity investment, remains at an all-time high, said Ken Riggs, CEO of RERC. "Real estate is tangible and more transparent than stocks, so it stands to reason that during this time of mistrust, investing in what you can see is more appealing than what isn't visible. Real estate deal flow is beginning once again as buyers and sellers make decisions based on quantifiable market fundamentals."

Due to rising unemployment, vacancy rates continue to increase for most property types on a national level and in most of the 31 metro areas RERC tracks. "Until business expands its appetite for space, lack of demand and even further contraction is expected," Riggs said. According to second quarter 2002 investment criteria presented in the summer issue of the RERC Report, values declined for all nine property types surveyed. …

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