STEVE PUMPER
Executive Managing Director
Investment Services,
Transwestern
As the environment continues
to change, how can ;rms best
complete transactions?
It is important to utilize a co-investment
strategy to align your interests closely
with clients. The strategy is powerful as
institutional investors invest directly with
those who are building and buying.
Currently, when an asset is brought to
market, the competition is extremely
high. It becomes dif;cult to place money
on both the equity and debt part of the
equation. Everyone wants accessibility to
deal ;ow and good information that
allows for smart long-term investments.
Having talent on the ground to source
opportunities to our clients has never
been more important. You must ;nd better information to share with clients,
allowing them to play more in the core
and value-add space. There is plenty of
real estate out there for everyone to play.
But the people moving forward successfully will marry good, on-the-ground
information with money in the game to
partner with institutional clients.
For more insights into the current market,
visit transwestern.net
HOWARD ROTH
Global & Americas
Leader, Real Estate,
Ernst & Young
How do you see accounting
impacting the industry over
the next few years?
The Financial Accounting Standards
Board is expected to issue a proposal
shortly that is likely to substantially
change the ;nancial statements of real
estate investors. It would require them to
measure their assets at fair value, as
opposed to historical cost, which is the
current practice under US Generally
Accepted Accounting Principles. This
would be a monumental shift for those
used to reporting at cost and systematically depreciating assets over their expected
useful lives. This arose from an effort to
eliminate a signi;cant difference between
International Financial Reporting
Standards and US GAAP. It would
require changes in the fair value of real
estate assets to be reported through earnings, which opponents believe could
cause volatility in operating results.
Investors that report their assets at cost
today may not have the systems and processes to regularly report their fair value.
For more insights into the current market,
visit ey.com/realestate
DAVID ZIMMER
President, SIOR
President,
Zimmer Real Estate Cos.
When development comes
back, who has the best chance
of getting new projects?
Timing is everything in this industry.
Users know it is a buyer’s market in commercial real estate and know they can
control a deal when in the market evaluating alternatives. Since there is no speculative building to speak of in most parts
of the country, the time that it takes to
get a project to market is critical in
attracting the best tenants. Taking a site
through the entitlement process, obtaining all of the governmental approvals,
developing a set of plans and then pricing them can take six to nine months.
Developers who are able to create a pad-ready site with a set of building plans,
and are ready to go vertical with construction, can eliminate much of this
additional time. Time to market is critical
for tenants, and if a developer can take
that additional time out of the development process, he puts himself and his
;rm in a much better position to win the
business.
For more insights into the current market,
visit sior.com
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