As I mentioned last time, I have become involved again in the world of real estate investing. In particular, I have gotten into the acquisitions arena focused on multifamily (which I deem the best of the food groups). My travels, in that respect, have taken me across this great country to look at deals. And, if anything has become clear to me so far, it's that whatever lessons should have been learned in 2008 either went unnoticed or are already forgotten.
To wit, I have seen bidding on assets in secondary and tertiary markets like the prize was a core property in New York or D.C. -- quite literally cap rates with a 4-handle in Florida, and not even on the east coast. Granted, I know the argument goes that on a long enough time horizon, real estate will ultimately return to its former status as a hard asset that can survive the seasons. But, that will require us to complete a deleveraging cycle that I think was simply put on hold. It will be tough, though, because real estate has become an institutionalized game -- no longer a domain dominated by individuals who actually manage the stuff themselves. Rather, we see mega-funds who have the capital to pretend that liability pressure is just a frame of mind rather than an actual concern. The upshot: I see the speculative juices flowing, which tells me that easy money is doing what it always does. And, in the end, this period of investing probably won't end well for a lot of folks.
As a final note, wanted to recap the Knicks season so far. 13-9, having won 10 of 11, and 9-4 on the road. The schedule is about to get more difficult, but you can't expect to beat the good teams if you can't beat the bad ones first. Stoudemire is living up to his contract, Felton is a legit NBA point guard who is making his case to be an all star, and Landry Fields continues to impress. For good measure, throw in Wilson Chandler, who has shown incredible versatility. All in all, I'm enjoying the season. Just wish I still had season tickets...
