On Monday, October 7th, the ULI Young Leaders Group Real Estate 101 Committee hosted their first event of the season. The panel discussion focused on “Navigating the Next Recession,” and drew a large audience. Featuring seasoned industry experts, including Mark Sharer, Rita Bamberger, Brian Hansen, Steve Walsh, and David Flanagan, the discussion revealed insights on surviving and thriving through an economic and real estate cycle. The panel was brilliantly moderated by John Coe, Principal, Coe Enterprises, LLC.
The conversation began by challenging the status quo opinion that recessions are inherently bad. Many of the panelists shared a positive outlook on recessions, stating “downturns can be an opportunity”, but also reiterating that “sometimes the best deals are the ones you don’t do.” They advised attendees to review deals with a particularly sharp eye, paying attention to market-by-market data in order to find opportunities that pencil.
The panelists generally agreed they do not see warning signs for an immediate nation-wide recession, but they are seeing localized stagnation in certain markets. Nonetheless, several of the panelists and their clients are raising capital to take advantage of a potential dislocation in markets.
In addition to opportunities for investment, the panel discussion touched on actions that firms or employees can take to thrive through a downturn. Many panelists made operational changes at their firms following prior recessions to ensure they are more nimble through the entire economic cycle. This included trimming down operational costs, not holding risky assets (like land), and maintaining high credit and underwriting standards.
Parting advice from the panel included a few valuable tips for attendees: 1) as an employee, be willing to learn, grow, and make oneself more valuable by taking on new challenges and learning new skills, 2) stay up-to-date on market data and have your own view (“don’t be a lemming”), and 3) constantly evaluate your position and make sure you are at a company that is well positioned for a downturn.
If you enjoyed our October Real Estate 101 event, stay tuned for the topic/registration link for our upcoming Real Estate 101 event on Monday, December 9th!