• Crystal Ball

My 2017 Forecast for Commercial Real Estate

January 19th, 2017|

Recently I heard a humorous quip that is appropriate for the moment we are in: “If you are not confused, it’s because you haven’t been paying attention.”  In preparation for writing this blog post I’ve read several 2017 forecasts from well-meaning and well-qualified economists and political commentators.  Their opinions vary widely as to what this year is going to bring, much more so than you normally see.   Economists usually succumb to the herd mentality.  They don’t want to be wrong so they more or less follow what everyone else is saying.  Not this year.  There are many contradictory opinions about 2017.

Before I give you my thoughts, let me start by saying that the most important events of 2016 were not anticipated.  No one predicted that:

  • The United Kingdom would vote last June to the leave the European Union.
  • Donald Trump would be the Republican presidential nominee, let alone win the presidential election.

And I’m confident there will be other important events in 2017 that no one, not the most seasoned prognosticators, will anticipate.  That said, there are really two questions that need to be answered in order to make accurate predictions about commercial real estate in 2017.

  1. What is the health of the U.S. economy?
  2. What phase is the real estate market cycle currently in?

Answering these two questions will go a long way in predicting the health of the commercial real estate market in the Pacific Northwest and beyond. (more…)

  • Donald Trump

3 Likely Outcomes of a Trump Administration on Commercial Real Estate

November 24th, 2016|

The Comfort of Opinion

John F. Kennedy once said, “Too often we enjoy the comfort of opinion without the discomfort of thought.”  This quote rings true when you look at all the opinions circulating on the internet about a Trump Administration.  Opinions range from euphoric to apocalyptic depending on whose political views you like to read.  This article will not change your opinion one way or the other about Donald Trump.  It’s not meant to.  This article discusses the impact a Trump Administration will have on commercial real estate.  Before I take a stab at that topic, let’s look at Trump’s economic thinking.

A Shift in Economic Thinking

Assuming Donald Trump governs like he campaigned, his economic ideology will be a major sea change in thinking for the Republican Party.  It will no longer be the party of Ronald Reagan.  Instead it will be characterized by:

  • Decreasing globalization and free trade. NAFTA (the North American Free Trade Agreement) will be renegotiated.  Participation in the TPP (the Trans-Pacific Partnership) will be withdrawn.
  • Fiscal policies that have the potential to greatly stimulate the economy but also have the potential for huge budget deficits.
  • The promotion of policies stimulating traditional domestic manufacturing above other sectors of the economy.

For the first time in our nation’s history we will have a real estate developer as president.  It stands to reason that his proposed policies should be very good for commercial real estate.

Trump Team Needs Capable Negotiators

As of this writing, President-Elect Trump has yet to name his economic team.  No one knows how much of his economic agenda he’ll be able to enact.  Because of Senate rules, Democrats still have considerable influence.  Consequently, how much legislation gets passed will require cooperating with the Democrats.  He’s president, not king.  So he cannot just decree that his policies be put into law.  To succeed Trump will need to have people on his economic team that are capable legislators.  They need to know how to negotiate well with the other side.  If not, very little will get through the Senate.  Let’s assume he is successful in getting his policies enacted.  Shown below are three likely outcomes that will affect commercial real estate: (more…)

5 Trends That Will Impact Your Real Estate Investments

May 10th, 2016|



The Portland economy and real estate market are clicking on all cylinders right now.  All you have to do is read The Barry Apartment Report Spring 2016 edition to realize just how good we’ve got it:

  • Unemployment at 4.3%
  • Job growth at 3.2%
  • Population growth at 1.6%
  • Portland-Salem Consumer Price Index at 1.2%
  • Apartment values up 10 to 20% in 2015
  • Apartment income up 4% to 7% in 2015
  • Apartment vacancies at 3.5%

Life is good.  Isn’t it?  It’s so good that there are days that I pinch myself to see if I’m living in reality or some make believe world.

But how is the rest of the U.S. real estate market doing?  You may be thinking, “Why should I care?” The answer is simple: You should care because sometime in the not too distant future we will follow down the same path.  In some instances we’re already doing so but we have yet to feel the full affect of the nascent trend.  The Portland market is not an island unto itself that is unaffected by the rest of the country.  So Portlandia and the Pacific Northwest in general will inevitably follow.


So what’s going on?  There are some interesting trends happening even as we speak: (more…)

Negative Interest Rates – Coming to a Bank Near You

February 5th, 2016|


In my January 9th blog post, “My Crystal Ball Forecast for Commercial Real Estate in 2016” I stated that even the most seasoned prognosticators will fail to predict major events occurring in 2016. And these unexpected events will have enormous influence on the economy and specifically on commercial real estate. (more…)

  • Tipping Point Marshall Commercial Funding

Apartment Rental Rates – Are We at a Tipping Point?

January 23rd, 2016|

In my last blog post, My Crystal Ball Forecast for Commercial Real Estate in 2016, I made five predictions about the coming year. One of my predictions was that 2016 will be the last year for modest growth for the US economy. Unfortunately it appears the world is heading towards a recession this year and the US will likely follow sometime early next year. (more…)

  • Crystal Ball

My Crystal Ball Forecast for Commercial Real Estate in 2016

January 9th, 2016|

I’ve always believed it’s better to have an opinion and later be found wrong than to be a person who has either no convictions or doesn’t have the courage to express them. So I respectfully disagree with the saying, “It is better to remain silent and be thought a fool than to open your mouth and remove all doubt.” (more…)

  • Dragon flying

Chinks in the Armor – 2 Indicators U.S. Economy is Faltering

October 1st, 2015|

In the classic book, The Hobbit by J.R.R. Tolkien a thrush lands on the shoulder of Bard the Bowman and speaks in a language he can understand. The bird tells Bard to watch for the dragon’s weak spot, a chink in his armor in the hollow of his left breast. Bard looks, sees the open patch, and lets fly his last arrow. It plunges through the chink in the dragon’s armor and buries itself in his heart. The dragon comes crashing down, a dramatic death to the evil Smaug. (more…)

The Five Most Interesting Articles I Read this Month

January 26th, 2015|

Hey, it’s me again. By now most of you know that I like to read. It’s my passion.

As you know there are lots of good quality commentary and insightful articles that are overlooked by most of us. But unfortunately for every good blog post or news article there are many, many more that are not. (more…)

My Crystal Ball Forecast for 2015 – 7 Predictions

January 10th, 2015|

I’ve always believed it’s better to have an opinion and later be found wrong than to be a person who has no convictions, or courage to state one’s opinion, and be safe from the criticism that naturally follows from missing the mark. As the saying goes, “Fools rush in where angels fear to tread” applies to me. (more…)

6 Things to Ponder: Thoughts from the Beach

August 11th, 2014|

As I’m writing this article, I’m overlooking the Pacific Ocean from a condominium perched on top of a 30 foot high cliff. I have a direct view of the beach. In fact the beach begins about 10 feet from the end of my deck. In Portland today the temperature is expected to reach triple digits for the first time this year, but at Pacific City the temperature is rather cool. (more…)