Whenever it comes, fund managers plan to prove their mettle
on the downside
Being a real estate hedge fund manager may have
seemed easy over the last few years as the real estate sector
benefited from back-to-back double-digit gains in residential
and commercial property values in many major metropolitan
markets, from New York to San Diego.
But where the sector is headed next is anyone's guess. There
has been no shortage of predictions that the bubble will
eventually burst, and Hurricane Katrina has now thrown another
wild card into the mix. Will hedge funds gobble up the
distressed mortgage debt and home in on developments in the
Gulf area? Will the Federal Reserve ease on its ramping up of
interest rates in order to mitigate any potential blow to the
economy, thus keeping real estate prices soaring?
Whatever the answers to those questions, the 20 or so
dedicated U.S. real...