Guarded Optimism in Commercial Real Estate?

2009 was a pretty tough year for most involved with commercial real estate. We actually had a decent year because we had established some strong relationships with companies involved with commercial real estate workouts and foreclosures. Their volume picked up substantially and continues to do so. Early 2010 indicates a continued tough road for CRE for now. It has been interesting to notice the varying attitudes of those involved at the various industry events we have attended.
 
In January, at the National MultiHousing Council's big event ("the NMHC") the speakers and panelists all seemed to think that 2010 will continue to be difficult, but in one-on-one meetings with those involved with acquiring multifamily real estate I got a different attitude. In almost every case they were out working on deals, and most companies I met with had a deal closing in the next 30-45 days (some were large deals too). The attitude seemed to be, "It is going to be a tough year for most, but we have found a nice niche and expect to have some decent activity." Our own volume on the origination side (Phase 1's, Property Condition Reports, and Physical Needs Assessments) was slow in January but really picked up in February. March looks decent too. The multifamily arena does have the advantage of having GSE money available through Fannie, Freddie, and the very active HUD/FHA lenders.
 
The attitude at the MBA CREF (Mortgage Bankers' Association Commercial/Multifamily Real Estate Finance) Conference was different. Much less optimism (with the exception of HUD/FHA lenders, and even they are not sure how long their programs will be such a preferred option). The exhibit hall was much smaller than in years past. If they really had the 1900 attendees they claimed, those people certainly didn't spend much time in the exhibit hall.
 
Perhaps the difference in attitude between the two events was the fact that the lenders are currently dealing with so many on-going issues with distressed assets, whereas those buying multifamily assets were hoping to pick up some bargains. Certainly, both groups have become much more careful in their underwriting, which bodes well for the deals that are getting done. It will be interesting to see how the year plays out!