Well, the surprise is that there’s been a significant break in that growth pattern, because of delevering, deglobalization, and reregulation. All of those three in combination, to us at PIMCO, means that if you are a child of the bull market, it’s time to grow up and become a chastened adult; it’s time to recognize that things have changed and that they will continue to change for the next – yes, the next 10 years and maybe even the next 20 years. We are heading into what we call the New Normal. Pimco
The NCREIF Property Index is a quarterly time series composite total rate of return measure of investment performance of a very large pool of individual commercial real estate properties acquired in the private market for investment purposes only. All properties in the NPI have been acquired, at least in part, on behalf of tax-exempt institutional investors - the great majority being pension funds. As such, all properties are held in a fiduciary environment. NCREIF requires that properties included in the NPI be valued at least quarterly, either internally or externally, using standard commercial real estate appraisal methodology. Each property must be independently appraised a minimum of once every three years. Because the NPI is a measure of private market real estate performance, the capital value component of return is predominately the product of property appraisals. As such, the NPI is often referred to as an "appraisal based index." At the moment there are roughly 6000 individual properties in the index whose value approaches $300 billion. Sorry for the knock down drag out description as to who these folks are and how the index is calculated, but it is one of the most “transparent” pieces of data regarding ongoing CRE values I’ve seen. Of course it seems the government alternatively believes that by wiping away mark to market we can just go back to lying to ourselves and everything will be just fine. That worked out really well in the prior cycle, no? In terms of honesty and integrity, I’ll take the NCREIF data any day of the week, thank you.
Real Estate Research Corp. (RERC) given at the summer 2009 conference of the very same NCREIF. RERC bills themselves as “one of the first, and one of the most recognized, independent and objective commercial real estate research, valuation and consulting firms in the nation. For more than 75 years, RERC real estate research, publications, market studies, property valuations, investment criteria and trends analysis have proven visionary”. Anyway, the following is some data Mr. Riggs presented to the NCREIF crowd literally seven weeks ago in terms of prior CRE cycle character.
Tyler Durden at Zero Hedge points out that the “real” unemployment rate is 16.8% , including “total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers.” Research Recap
Structural job losses in retail, finance, and manufacturing.
Economist
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