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Cap rates seem to be stabilizing and in some cases going back down. This is typically considered a signal that it is time to buy property. Commercial real estate yields (cap rates) are near their highest level relative to treasury bonds on record. Also, more businesses may prefer to buy instead of lease – since if the lease liability is greater (or close) than ownership makes sense again. It is likely that businesses may want to shorten leases to reduce liability. One other change to expect and adjust to: there is a proposed FASB rule (already existing in International accounting) that requires the entire obligation created by a lease to be put on the company balance sheet as a liability. And of course the most important reason … the government told us so… not that it didn’t elicit a smirk from most of us, but the National Bureau of Economic Research (NBER) announced that the present recession ended and the recovery began June of 2009. However, expect deals to require more equity, less leverage, higher debt service coverage ratios. Now let me tell you some of what I expect lots of political fireworks in the month ahead, higher than expected industry earnings reports, real estate transactions (leasing and sale) picking up, banks starting to disgorge REO’s and slowly begin lending again. With that as the backdrop, I realized I’m not in a slump, the economy is! Now let me tell you the best news the economy is getting better…slowly. This year has been marked by a great deal of frustration low-to-no deal flow, erratic economic news, skittish stock market, anemic consumer confidence, a ballooning Federal deficit and more of the same from the Washington crowd. The aftershocks continue today to affect our economy and personal lives as we struggle to regain our financial freedom. September 15th was the two year anniversary of the Lehman Brothers bankruptcy and weekend that our banking system faltered at the brink of a meltdown. September 11th was a stark reminder of how fragile our freedom is and how it is constantly threatened. “It’s tough to make predictions, especially about the future.”