Multifamily Executive Online is reporting what on first glance is sobering news from two different professional meetings this week, though we’d argue there’s a silver lining to be found in both perspectives.

From the National Association of Home Builders conference in Las Vegas this week, understandably the perspective of builders / developers has been very sober.  Here’s a quote from Chris Wood’s article posted on MFE’s website yesterday –

National Association of Home Builders (NAHB) senior staff vice president of multifamily Sharon Dworkin Bell didn’t mince words when it came to analyzing the state of multifamily markets here at the International Builders Show in Las Vegas this week. “In the past, we’ve had exciting multifamily news,” Dworkin Bell said at the IBS’ annual multifamily news conference. “But the story this year is that the turmoil you are hearing about in the capital markets that has been affecting single-family housing is now starting to affect the multifamily industry.”

While Dworkin Bell pointed out that multifamily property fundamentals remain strong and emphasized that the market has not been overbuilt to the extent that excess inventory plagues single-family markets, she nevertheless reiterated a forecast by NAHB staff vice president of forecasting and analysis Bernard Markstein that puts 2009 multifamily starts at 188,000. That’s a significant cut into the 350,000 units the industry has been dependably churning out for the past several years.

“There is demand for apartments both market-rate and affordable; there is a need,” Dworkin Bell said. “But because of a lack of financing, this much needed rental housing is not going to be built.”

Likewise, Steve Lawson of Virginia Beach, Va.-based Lawson Cos., a developer of single-family and multifamily housing (both market-rate and affordable), didn’t offer IBS attendees any good multifamily news. Lawson reported that equity requirements for debt qualifications are making construction impossible. In addition to losing sector employment critical to improving the national economy, Lawson says the kink in development pipelines could create additional crises as Gen Y renters enter a market plagued by a lack of supply.

The silver lining here – constriction in supply induced by current economic travails bodes well for multifamily operators down the road (whether it’s in 2011 or beyond). 

Shabnam Mogharabi reports from the National Multi Housing Council’s Apartment Strategies Conference held this week in Palm Springs, California.  Here’s how she opened her article At NMHC Annual Meeting, Multifamily Braces for a Tough Year Ahead. 

There’s no place to hide. That’s the message out of the NMHC Apartment Strategies Conference, where 950 people gathered this week in a surprisingly strong turnout for the event in Palm Springs, Calif.

With the economy suffering devastating job losses and development at a standstill, executives across the multifamily real estate business indicated in panels on Wednesday that there will be no way to escape the financial grind of 2009.

The doom and gloom sentiments were pervasive but not overwhelming. “I think fortunes will be made over the next year or so,” said Dave Woodward, CEO of Greenwood Village, Colo.-based Laramar Group. The firm is considering raising a second fund with Credit Suisse that would focus on distressed assets. Chicago-based Waterton Associates is likely to do the same.

The silver lining here – distressed assets will become increasingly available as the recessionary environment lumbers on. 

When given lemons – make lemonade. 

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