Published January 6th, 2008 by Mickey
USC Lusk Center’s Stan Ross Says Real Estate Industry Should Prepare For Tougher 2008
LOS ANGELES — The residential real estate industry could drag the commercial property sector into a downturn in 2008, and real estate investors, developers and service companies need to start preparing now for what could be a tougher business environment.
“No one knows what will happen to the economy, the credit markets, or oil prices next year,” said Stan Ross, chair of the USC Lusk Center for Real Estate. “But real estate companies shouldn’t wait to see if a storm will hit, or how intense it will be,” he added. “They need to start their contingency planning today.”
Ross said companies can begin by assessing the current health of their organizations. Then they can consider how to maintain the stability of their companies in 2009 under different risk scenarios such as the economy’s sliding into a recession or property markets weakening further.
A health checkup includes a diagnostic of the organization itself and analysis of the external forces including the economy, business environment and especially local market conditions. Ross suggested that companies conduct ongoing market assessments and evaluate the impact of market changes on an organization’s health.
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