The Dog Days of Summer?

For 25 years I have been witness to the month of August being the slowest month of the year for commercial real estate transactions - at least getting new ones started. Last night my wife asked me what I expect this year which made me realize (1) it is August already! and (2) it has been so slow the prior 7 months I really wonder how much longer this condition continues soooo… August 2009 may turn out to be the best August in many years due to significant pent up pressure.

I firmly believe that money cannot stay on the sidelines or “parked” for long periods of time. I think that predatory investors have learned that apartment building owners, while disappointed in growth/reductions in income, are not desperate to sell at any price so those buyer-wanna-bes are retreating to more volatile pastures leaving the real local investors dealing with buying in a time of adjusted (down) rent roll expectations combined with truly great borrowing rates. In other words, today is a pretty good time to invest in apartment buildings since the expectations are based on very realistic income assumptions and very attractive long-term debt available which combine to make returns on investment expectations reliable and meaningful.

If anyone agrees with this then August 2009 will be cat-quick instead of dog-slow.