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Is the Real Estate Market Going to Collapse?
Photo by Carolyn Cole / Los Angeles Times
Photo by Carolyn Cole / Los Angeles Times
In a wide-ranging Los Angeles Times interview Robert Sulentic (MBA 1984), president and CEO of CBRE Group Inc. (long known as Coldwell Banker & Co.), is bullish about the real estate market, the future of brick-and-mortar retail, and the growth of entrepreneurship outside Silicon Valley. (All those startups need office space!)
From the interview:
LAT: Experience teaches us that the real estate market is cyclical, and we’ve been on the upswing for years now. Is it time for a downturn?
Sultentic: We expect the economy will sustain slow growth into next year. If it’s slow growth, there won’t be a lot of overbuilding. Historically, several years into an economic expansion there is overbuilding. Now the market is more organized. This is unlike any cycle I have seen in my 33-year career.
LAT: Are you saying the real estate industry somehow finally got smart enough to avoid overbuilding and tanking the market?
Sultenic: The industry is capitalized and managed more transparently and thoughtfully than it has been historically, with less easy money floating around. Banks got smarter, equity sources got smarter and developers got smarter and more conservative. Compared to 25 years ago, the business is more transparent, professional and institutional. That makes a crash less likely.
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