Throughout the first two quarters of 2009, BHA analysts took note that overwhelmingly, alternative investors were requiring favorable liquidity terms when considering new opportunities. As a result, their interest in real estate funds dropped considerably. During the past few weeks, however, BHA analysts have seen a turnaround in investor interest in the real estate sector and, specifically, commercial property.

Commercial property is being devastated by the global recession two fold. First, property values, which are directly affected by the state of the economy, have been dropping. Second, many commercial property owners are being forced to sell their holdings. Decreases in consumer spending are forcing countless stores to close—stores that commercial property owners rely on to pay their mortgages. As more and more stores shutter their operations, more and more commercial property owners are being forced to sell their properties at steep discounts to avoid the risk of foreclosure.