Time to sell off real estate assets?

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A fire sale of sorts for commercial real estate is imminent. At least that’s the take at Newport Beach-based AppraiserValues.com’s Cap Rate News Blog. In the wake of the Wall Street meltdown, ‘liquidation of real estate assets will be one of the first places firms will look for cash.’

If you think this doesn’t matter, you must not be a public servant who hopes to retire one day. Writes Warren K. Hoppke, senior real property analyst and a member of the Appraisal Institute: ‘The nation’s largest public pension fund, the California Public Employees Retirement System (CalPers), could take a hit as large as their $2 billion dollar residential mortgage portfolio.’

Hoppke sees a ‘long flat period of very weak demand for real estate’ that could last for the next decade. In the short term, ‘expect to see commercial real estate price declines throughout 2009 and 2010.’

-- Lauren Beale

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