Tuesday, January 04, 2011

Mort Zuckerman On Commercial & Residential Real Estate In 2011

On the afternoon of yesterday's post regarding housing prices, Mortimer Zuckerman, the Chairman of Boston Properties, as well as US News & World Report, weighed in with similar views to Peter Schiff's in an interview on CNBC.

It was interesting to observe Zuckerman carefully avoiding agreeing with CNBC co-anchors that commercial real estate would henceforth escape a serious crisis. What he did say was that his Boston Properties firm, which just purchased the Hancock Center in Boston, concentrates on high-end commercial properties, which do better in downturns. He implied that he expected a further softening of the market, but didn't explicitly say that.

However, he did reinforce Schiff's contentions, in the latter's recent Wall Street Journal piece. He went on to observe that with continued high unemployment and probable declines in residential real estate prices, there could well be an economic softening later this year. Further, he railed against continued excessive government spending, even in the guise of the recent tax rate extension bill.

Zuckerman isn't infallible, but he's a very shrewd guy. It seems that evidence continues to mount for worrisome, real estate-led economic developments later this year.

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