Should CRE Players Return to Defensive Investing?
It feels to me like we are in extra innings, running on borrowed time.

Over the last eight years private equity real estate has witnessed some of the best total returns in its history. This has also coincided with the longest stock bull market in U.S. history. Some investors feel as if the current expansion can continue unabated. More disturbingly than that, and perhaps spoiled by the astounding returns in this cycle, many investors are still reaching for IRRs they achieved in the near past, blithely ignorant of the fact that most of the appreciation was the result of mean reversion and record low interest rates. Investors remain aggressive today when they should be defensive...

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RSK: David is right on here. Investing will see its returns in cash flow, depreciation and debt reduction in my book. Appreciation if any will be a plus.



- - Volume: 6 - WEEK: 27 Date: 7/3/2018 11:48:02 AM -