If I'm not mistaken, you were looking in the San Jose area. Articles from the IRR-Viewpoint to Colliers and most other in the area are going to suggest that it still does have a bit to go down. Colliers suggested recently (2Q) that it has another 5% to go. I personally believe they're pretty close. There would be TONS of foreclosures in the CMBS market, but by now most banks, lien holders and bond holders have figured out that they might as well take a small loss and restructure the loan vs. foreclosing - something that took banks in the residential market almost two years to figure out. My advice, if you see something that makes your desired return, go for it. I always tell my clients to not be greedy. Most people don’t complain about “missing the bottom” if they’re making their desired return yearly. Usually they complain about the investment they SHOULD have bought but didn’t.
Aug 5, 2009