November 14, 2005
Stuart Gabriel, director of the University of Southern California Lusk Center for Real Estate Development, Los Angeles, who was not involved with the study, agreed.
``Some of the margins are razor thin,'' Mr. Gabriel said. So, when returns of core real estate start dipping to or below that of other asset classes, real estate will become less attractive to investors, he said.
``Real estate is priced to perfection, which is code for the pricing is rich compared to fundamentals,'' Mr. Gabriel said.
Still, investors are more rational than they were in the 1990s when a real estate downturn devastated high return expectations, he said.