Welcome to theWelcome to theColdwell Banker CommercialColdwell Banker Commercial

New York Regional New York Regional Commercial Real Estate ForumCommercial Real Estate Forum

Host Company:Coldwell Banker Commercial Properties Unlimited

Climb For Kid’s Sake 2007 TeamRaised $35,000

Climb For Kid’s Sake 2008September 20th – 27th

Our Goal $52,374www.events.org/cbcclimb

Recent BBBS EventRecent BBBS Event

Market OverviewMarket Overview

Early Innings of a Early Innings of a Challenging MarketChallenging Market

Tale of Two MarketsTale of Two Markets

• Investment Sales and Related Pricing

• The Overall Fundamental Picture

Capital MarketsCapital Markets

Capital MarketsCapital Markets

Prices are declining as CAP rates return to normalized levels

Active buyers are sidelined

Cash buyers (Institutional) are taking advantage of the market

Increase in foreign buyer interest

Sales Volume (70%), - However, over $85b of significant deals did close

All cash, assumable mortgages or seller financing are behind the majority of successful transactions this year

The major national banks account for just 9% of acquisition financings

Capital MarketsCapital Markets

Sources of Acquisition FinancingSources of Acquisition Financing

Source: RCA

Office: Cap Rates and Office: Cap Rates and Transaction Volume Transaction Volume

Source: RCA

CBD SUBURBAN

CBD SUBURBAN

Industrial: Cap Rates and Industrial: Cap Rates and Transaction Volume Transaction Volume

Cap Rates (7.35%)

Sales Volume (49%)

FLEX WAREHOUSE

FLEX WAREHOUSE

Source: RCA

Sources of Acquisition FinancingSources of Acquisition Financing

Source: RCA

Industrial: Market & Regional Industrial: Market & Regional Volume ChangesVolume Changes

Source: RCA

West

Retail: Market & Regional Retail: Market & Regional Volume ChangesVolume Changes

Sales Volume (62%)Source: RCA

Retail Cap RatesRetail Cap Rates

Cap Rates Overall (7%)Source: RCA

Multi-Family: Market & Regional Multi-Family: Market & Regional Volume ChangesVolume Changes

Source: RCA

Multi-FamilyMulti-Family

Cap Rates (6.6%)

Sales Volume (45%)

GARDEN MID/HIGH-RISE

GARDEN MID/HIGH-RISE

Source: RCA

Market FundamentalsMarket Fundamentals

Market FundamentalsMarket Fundamentals

• Weakening National Picture

• Disciplined Market on Supply Side

• Turn from a Landlord’s to a Tenant’s Marketplace

OfficeOffice

Absorption (negative)

Vacancy (13%)

Rents (3.9%)

Source: Reis

IndustrialIndustrial

Net Absorption (225K)

Vacancy (10.3%)

Rents (2.9%)

Average NNN rents:

Flex: $10.21

Manufacturing: $4.70

Warehouse: $4.60

Source: Reis

Retail: Consumer SentimentRetail: Consumer Sentiment

Source: Reis

RetailRetail

Absorption (-3.2m)

Vacancy (8.2%)

Rents (2%)

Source: Reis

Multi-FamilyMulti-Family

Rents (4.4%)

Vacancy (6%)

Source: Reis

SummarySummary

Market SummaryMarket Summary

Expect price declines (5% - 15%) for investment properties

Leverage remains scarce (primarily balance sheet lenders only)

Sale inventory increasing significantly but no “fire sales”

Fundamentals indicating a weakening picture through 2009. A transitioning market but the picture is not an unhealthy one

Services IndustryServices Industry

Revenues will be off in sales and leasing by 20% -30%

Consolidation of providers (mergers and acquisitions) will continue

Market Knowledge - not information will drive “off market” opportunities

What You Can DoWhat You Can Do

• Drive better credit tenants to properties 

• Position the asset within its market, not the market within the asset 

• Establish a repositioning strategy to drive value

• Incentive fees for Property Managers

• Corporations need help listing sublet space

• Develop knowledge scenarios that differentiate you

• Stay on top of every piece of business you have

• Use the platform to differentiate

Welcome to theWelcome to theColdwell Banker CommercialColdwell Banker Commercial

Western Regional Western Regional Commercial Real Estate ForumCommercial Real Estate Forum

Host Company:Coldwell Banker Commercial Properties Unlimited