Distress in the housing market is benefiting the apartment market, which the report lists as the number-one “buy.” Moderate-income apartments in core urban markets near mass transit offer the best buy, a trend that carried over from the previous year.
…and the full recap for 2009:
* Investors should sit tight. Opportunities will surface at significant discounts.
* Buy discounted loans.
* Recap distressed borrowers – invest in maturity defaults, construction loans/bridge loans, or take mezzanine positions and equity stakes in properties.
* Invest in publicly-held real estate investment trusts (REITs) – they will lead the market’s recovery.
* Focus on global pathway markets – 24-hour coastal cities.
* Staff up asset managers, leasing pros and workout specialists. Separate good assets from bad.
* Retrench on development and reorient to mixed-use and infill. Higher-density residential with retail will gain favor in next round of building.
* Go green – cutting energy expenses is likely to be a priority.
* Buy or hold multi-family; hold office; hold hotels; buy residential building lots, but be prepared to hold.
* Purchase distressed condos in urban areas near transit.
* Focus on neighborhood retail centers with strong grocery anchors and chain drugstores.