Those of you who know me well know that I’m a glass-half-full kind of guy. I find it interesting then when I hear concerns over a possible correction coming in 2019.
Now, just to be clear, no one is predicting doom or gloom, but given the length of the current upcycle, the second longest in our history (the 10 years leading up to the tech bust of 2000 heads that list), the published reports I have read simply seem incredulous that it could continue. As a result, every blip on the radar becomes the sign of a correction. Essentially there are three reasons why I find no cause for concern.
First of all, from my perspective both as a property management practitioner and as president of the Institute or Real Estate Management, I am engaged in an industry that is virtually recession-proof. In fact, an argument can be made that in down times, keen property management—management that is attuned to the value enhancement of properties in the strategic interest of our ownership clientele—becomes even more critical.
I should add here that this job security is a major selling point in our work with junior and future CPM designees alike. There are other disciplines within the commercial real estate universe that can boast larger paychecks and juicier headlines. But nothing trumps longevity and security in sexiness when you’re trying to raise a family.
Second, there is no real bellwether of alarm, other than the possible activity of interest rates, any indirect bearing on the economy that could come from current global trade battles, or some other global surprise. In fact, according to the 2019 edition of Emerging Trends in Real Estate, the operative word here is “plateau.”
“‘Coming off a peak’ seems to be a theme,” the report states. “One major institutional investor whose base case is for a continuation of the upcycle acknowledged, ‘We are adjusting a little bit right now.”
The way I see it, the underlying issues that made the last downturn so much fun, including the subprime time bomb, a freewheeling ‘anything pencils’ lending mentality and an exuberant stock market, are not in play this time. Well, two out of three ain’t bad. The stock market today is volatile, to say the least, and could cause some pain down the road if it continues for too long. But the best bet now is for a soft landing.
Finally, there is the frank realization that if all of the most dire predictions come true, we have been there, done that. For any seasoned pro who outlasted the Great Recession, a correction of the size pundits predict is small potatoes. Bring it on.
For IREM, we are looking with anticipation at another growth year, building on programs designed to deliver on the promise made when we rebranded just a year ago. We are particularly excited about expanding our global reach through growing relationships in Asia, South Africa and Russia, relationships that not only expand our sphere of influence but, more importantly, expand the networking opportunities for this very tight community of professionals.
We continue to actively promote the industry to a younger and more diverse audience of potential CPM candidates through our ramped-up educational efforts—in person and online—and a more active outreach program at the college level. We are at a critical juncture, not only in property management, but in the real estate industry as a whole and—as I have stated before in this space—such outreach is critical to our survival, not only in terms of age, but equally in terms of the changing demographic of the communities we serve. Stagnation is not an option.
We are building on a promise we made when we rebranded—to serve as the champion of the property management community. Delivering on that promise is a progression, and 2019 will be a continuation of the groundwork we have already laid down.
There are always challenges to face. You need only ask the pundits or read the headlines that lead with the potential cautionary notes.
We’re excited about the prospects the new year offers. Our sleeves are already rolled up. The work continues.
Don Wilkerson is 2018/2019 president of the Institute of Real Estate Management. In addition, he serves as president and CEO of Gaston and Wilkerson Management in Reno, Nev.