Whether the financial markets, the current building environment or affordable housing requirements, there's a lot going on in multifamily and mixed-use for 2016, according to our panelists at the San Francisco State of the Market last week at the Fairmont San Francisco.

The financial markets have crashed harder than expected, and AGI Avant CEO Eric Tao said there will be a slowdown in commercial real estate this year. That's Eric, above right, listening to a question from moderator Matt Macko, Environmental Building Strategies principal.

Back in 2000, the market simply stopped, said Mark Co president Alan Mark. "It was like someone tripping over a power cord." Financial uncertainty cuts both ways, he said. Sales parallel the stock market, but people see putting their money into real estate as a better long-term investment, he said.

While Hines senior managing director Cameron Falconer (below) expects tightening markets, the Bay Area may be able to benefit from interest rates held low by global concerns even as San Francisco continues to grow.

When it comes to building in this market, it makes a difference if you're taking a long-term view, Matt noted.

Cameron spoke about the benefit of working on 41 Tehama with Invesco, which has no plans to sell the 35-story luxury residential tower. He points out that land value is heading upward now for property that's fully entitled with approvals, but value is headed down for unentitled land in San Francisco.

Eric said he underwrites every project as if it's a long-term hold, but there's also the need to look at selling at the top of the market. There's a trick to the timing that sellers don't always get right, sometimes selling too early, he said. Now, with construction on 363 units in the Dogpatch neighborhood underway, the question is whether the timing is right for a pre-sale at around $1k/SF. Eric thinks there still may be room to move upward.

Alan (above) said condos are trending at about $1,200/SF. He believes they have a long way to go up in price.

San Francisco has the benefit of being a condo market that doesn't have a lot of new condos coming online—many of those approved in the city lie about 10 years out, Alan said. While residents in other cities might opt for a home in the suburbs after a certain price point, San Francisco residents are more likely to choose a condo, he said.

Matt also asked about affordable housing, a topic that has been top-of-mind in San Francisco in recent weeks. Eric said the effort (and hope) is to create more grandfathering of projects and pull back on the proposed 25% requirement. Cameron suggested the conversation should include how to create more permanent affordable housing that allows people to buy out of rent-controlled apartments. Any solution needs to be a regional one, he said.