www.reit.com Alan Billingsley, head of research with RREEF Asset Management, spoke with REIT.com about significant factors surrounding the economic recovery. Although most signs in the public eye point to the positives in term of recovery, Billingsley warned of three cautionary signs that are preventing a strong rebound. He says those signs include the consumer, the housing market and the fiscal government crisis. “The consumer is not back,” says Billingsley “He is rebuilding his balance sheet, his 401K retirement account is still devastated and home values are down.” Billingsley added that there are still more foreclosures ahead. He says home values haven’t reached the bottom and tells consumers to not expect values to rebound anytime soon. The government also plays a role. “Our fiscal government crisis has already manifested itself in layoffs in 2010,” he says, adding that the 250000-300000 jobs lost countered any gains in the private sector. He expects to see more layoffs in 2011. When asked about industry leaders as well as those lagging behind in commercial real estate fundamentals Billingsley didn’t hesitate to say that the apartment sector is number one. “Apartments are clearly the leaders, they recovered strongly in 2010 with three to four percent national rent growth,” he says. Office space is on the opposite end of the spectrum however. “I would say office is probably at the end of the queue; its better in some markets than others but generally office always …
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