That was the consensus of the region’s top investment sales gurus yesterday about this summer’s credit crunch, at NAIOP of Northern Virginia’s Capital Markets luncheon panel in front of 175 pension fund advisers, developers, and lenders. Things have calmed; there are no fire sales. And: Next year's sales volume will be down because people are holding assets longer and there won’t be large portfolio transactions like Carr or EOP.
Moderator Marc DeLuca of ING Clarion, right, observed that all panelists were native Washingtonians, so they have seen all the real estate trends over the years. They joked that recently the feeling was assets were worth more vacant than encumbered, ie, it was actually better not to have tenants because then you could go get new ones at ever-increasing rates. Looking back, they agreed this may have been a warning sign of irrational exuberance. Above, Smith Group’s Elaine Gray, who helped organize the event, and panelists Brian Dawson of Cushman and Bill Prutting of CBRE, who said real estate is like an ocean liner: “not so easy to sink.”
Buchanan Partners’ Brian Benninghoff with panelists HFF’s Jim Meisel, and Cassidy’s Bill Collins. Bill said “size does matter,” eg, transactions under $100m are much easier to finance than over $100m, and that portfolio premiums are “a thing of the past.” Panelists also noted a minor increase in expected IRR on core assets in DC to compensate for risk. And they pointed out that while both “study” periods and closings in olden times were 30 days, then went to 5-10 days—Bill even cited august Professor Douglas Jemal who once remarked that “study is for libraries”—now it has bumped back up to 15 day study (since underwriters want more due diligence) and 30 day closings.
TA Associates’ Bob Provost, down from Boston, is flanked by Cushman’s Jim Underhill and Peter Berk. Peter’s not only a rock star, but is now related to one: His 15-year-old daughter was recently asked for a "callback" audition on Broadway.
Is this the bar of the swanky new 154-room Kimpton Palomar Hotel in JBG’s Two Waterview Place in Rosslyn? Doesn’t look very swanky to us. Oh, wait, that’s because it’s still being built and won’t open until November. But we joined JBG principal Kathleen Webb on a hard hat tour to see it under construction and will try to use our imagination. Look at all that Johnnie Walker Blue!
The Energy Efficiency Partnership of Greater Washington was launched last week at the National Building Museum, under which 100 area properties will be eligible for a “green face lift”: a free audit from Pepco Energy and retrofitting financed by venture firm Hannon Armstrong, which will make its money via back-end energy savings. Above, Transwestern’s Jeff Gross, GVA Advantis’ Nick Katz, Virginia Tech’s Jim Boland and Laurel Colless, DoE’s David Rodgers, Arlington County Board member Paul Ferguson, and Hannon CEO Jeff Eckel. By the way, Nick and colleague Pat Fehr just arrived last week at GVA Advantis capital markets from Coldwell Banker Commercial. Nick actually came to know GVA chief Brian Ball when Brian was his outside lacrosse coach in 7th grade. See, don’t you learn everything here in Bisnow?