Notes on NMHC

Last weekend the National Multi-Housing Council had their annual National Strategies Conference in Palm Springs.   This is the big meeting of the year where multi-housing (or multifamily as we call it) professionals meet.   Top lenders, property managers, brokers, large owners and industry experts get together to discuss the state of the industry and its future.  Over the last few years this has grown in importance as the industry has grown.   

I did not attend this meeting, but based on reports from about 1/2 dozen attendees this was a depressing meeting.  Most people left the meeting thinking that 2009 will be a terrible year in the apartment business.  The question is will it get better in 2010 or not until 2011 or maybe 2012.   The two key issues hanging over the meeting were the lack of lending sources for Multifamily properties and how the economy will effect occupancy and rents.  Oh yeah, everyone was also a bit concerned about the overall drop in multifamily housing values. The feeling was that from a financing standpoint the market was frozen with life companies and conduits basically out of the business and fears that the agency lenders who are still propping up the multifamily lending business might change their lending criteria or lending appetite. 

While most of the people I spoke to were full of doom and gloom, there were some bright notes.  However, these took the form of people either looking to take advantage of the current turmoil or people who were still feeding on the hope of the Obama inauguration and stimulus package.  

From my perspective the feelings that came out of the meeting are old hat.  These are, and have been the concerns for at least the last 6 months.  The problem is that many people thought the current economic environment would pass over the multifamily world because we did not see the excesses of the single family residential lending.  However, we saw many of our own excesses and the tone of the meeting was correct.  2009 will be a tough and depressing year for many.  However, in the long run this business will survive and thrive.  People need places to live and demographic trends favor multifamily housing.  S0 just hold on to the roller coaster and know that eventually the ride will end.