FORTUNE – Investors have spent years dodging disaster in one area of the markets, only to find their investments coming to a bad end elsewhere. However, there is one sector that has been outrunning the grim reaper since 2007, and it’s the last place you’d expect to have survived so long: commercial real estate. For much of 2008 and 2009 CRE was awash in red ink, and yet it hangs on. Richard LeFrak, chairman of the LeFrak Organization, said at the Milken Institute Global Conference in April, “The failure that we were all anticipating in the commercial real estate market, it kind of didn’t happen. We blinked, it went away.”

The only question now is how long it can keep up the sprint while the ghosts of boom-time leverage haunt the sector, and $1.4 trillion in loan maturities loom three years over the horizon.

There is a sharp disagreement among experts in how things will play out. Some predict foreclosures, loan defaults and a national crisis of disastrous proportions. In that corner is Elizabeth Warren’s Congressional Oversight Panel, which flatly predicted this year that commercial real estate loans are heading for a crash that will bring down small banks, destroy small-business lending and create “a downward spiral of economic contraction,” in her ominous words.

On the other side, investors in commercial properties and buyers of commercial mortgage-backed securities believe that the commercial real estate market will continue to suffer until it hits a bottom, but it will never crash in the way that the residential market collapsed. They believe that commercial real estate will be an example of how a market can take the hits and keep on ticking, that not every spot of trouble results in a crisis, that an industry can actually, somehow, stop a crisis if it acts early enough and has enough support.

Peter Roberts, Chief Executive Officer of the Americas for property giant Jones Lang LaSalle (JLL), put it this way: “We’re not going to see a ‘crash’. We’re going to see a long work-through.” Roberts believes commercial property values are in the process of bottoming out and will get to the ground floor by early 2011.

He credits the government’s support programs in capital markets with reversing the psychology of nervous markets in 2009: “The powers that be are very focused in making sure that we don’t have a crash in the real estate market. That has infused the mindset of investors.”

Investors are making the most of their good luck while they can. There have already been deals of several different varieties that show us their plan for addressing the problem of high-water mark commercial mortgages coming due.

Of them, there’s no better example of temporarily sidestepping the debt monster than Blackstone Group’s clutch move with Hilton Hotels. The PE firm’s $26 billion buyout of Hilton in 2007 — with $20 billion of outstanding debt due by 2013 — is a prime example of the sweaty palms that high leverage deals can cause even savvy investors.

But in April, Blackstone (BX) bought back $1.8 billion of Hilton’s debt and restructured another $2.1 billion to turn it into preferred equity. Blackstone also pushed off the maturities of the remaining $16 billion until 2015, buying itself two whole years of breathing room. Hilton is still debt-laden, but it’s not dead — and hedge-fund investors speak approvingly of Blackstone’s decisions to face its problems early.

The deal has kicked off a quiet trend of what one real-estate investor at a hedge fund calls “mini-Hiltons” — a pending wave of real estate investors seeking to buy back and restructure their own debt to stay alive until the recovery.

In another pattern, auctions for distressed assets are becoming more and more competitive, giving troubled assets quick homes. One of the most notable was the acquisition of Corus Bankshare’s $4.5 billion real estate portfolio, sold for a mere 60 cents on the dollar in an FDIC auction to a group of real estate investors and hedge funds including Barry Sternlicht of Starwood Capital Group, TPG Capital, WLR LeFrak and Perry Capital. The FDIC kept the majority of the portfolio, but gave the buyers zero-percent financing — a sweet deal for any investor.

Since properties have become so hard to buy, many investors have turned with voraciousness to the bundles of securitized loans known as commercial mortgage-backed securities, or CMBS. If anything in commercial real estate stands ready for a reckoning, it is these securities.

Despite CMBS hurtling toward higher default rates, however, investors who have faith in them are practicing some serious compartmentalization. They say that there are only some CMBS — and some tranches of CMBS — that will be hurt. They believe that the highest-rated tranches, rated triple-A, are in no danger.

They also say that CMBS could never create as much havoc as their residential cousins because of their structure: They are made of whole loans that haven’t been chopped up as much in the Wall Street sausage factory, and are based on stronger assets.

The tranches most likely to be hurt, of course, are those with the worst ratings – the triple Bs. These were the biggest victims of lax underwriting standards. According to Commercial Mortgage Alert, the boom years of 2005 through 2007 saw a total of $602 billion in CMBS issuance. (The CMBS written during those three years, by the way, account for a whopping 49% of all CMBS written over the past 20 years.) Those are likely to be the problematic securities. The CMBS written before and after don’t have as much leverage put on them, say investors.

CMBS, however, accounts for only about 20% of the total loan market, according to Jones Lang LaSalle’s Roberts. The bigger danger to the capital markets — and to banks — are speculative commercial loans, like those in construction and land loans. Those aren’t backed by firm assets and are a key part of the reason that many smaller banks have failed in recent years. It is these loans, in particular, that worry Warren and others, and could yet bring a reckoning to CRE.

There is a lot riding on the outcome of commercial real estate’s do-it-yourself salvation. If the sector can escape the same kind of crash that took down residential real estate, then we have a case study in how investors and government can prevent a crash before it happens. If it doesn’t work, however, the economy could be hit again at a moment when it is least able to bear the punch

As reported by CNNMoney.com

One may be surprised to see that shares of real estate investment trusts, or REITs, are on fire this year. The iShares Dow Jones Real Estate (IYR) exchange-traded fund, which owns about 75 real estate stocks, is up 9% so far in 2010.

There are various types of REITs focusing on different types of properties. And REITs across the board are having a good year.

Hotel owner Host Hotels & Resorts (HST, Fortune 500), which is in the S&P 500, has shot up 25% this year. So have shares of Kimco Realty (KIM), a REIT that primarily owns shopping centers. Office property owner Boston Properites (BXP) is up nearly 15%.

What’s the attraction of REITs in what remains a stormy market for residential and commercial real estate? It’s tempting to sum it up in one word. Yield.

Real estate investment trusts pay at least 90% of their taxable income to shareholders in the form of dividends. Doing so exempts REITS from having to pay federal income taxes.

For that reason, REITs tend to sport eye-popping dividend yields that make them more intriguing than bonds for fixed-income investors, especially in a low interest rate environment such as this.

The yield on the iShares REIT ETF is currently 4.5%. By way of comparison, the benchmark U.S. 10-year Treasury is yielding about 3.9%.

“REITS have been running up a bit as investors chase yield. Individuals that are largely in fixed income are starting to realize that there are better investments,” said Jill Cuniff, president of Edge Asset Management, a Seattle-based investment firm that runs the Principal Equity Income fund.

So the REIT rally makes sense when you consider that owning stocks that consistently pay dividends is a smart strategy for a long-term investor.

According to Ned Davis Research, stocks that steadily grow their dividends have had an average annualized return of 9.3% going back to 1972. That beats the S&P 500’s average return of 7.1% and is far better than the puny return of just 1.3% for stocks that don’t pay dividends.

But there’s more to the real estate run than a hunt for a high yield. Jeung Hyun, principal with Adelante Capital Management, an Oakland. Calif.-based money manager, points out that another sector known for steady dividends — utilities — has lagged the market this year.

Hyun said that even though there are still worries about the current state of the economy, investors are anticipating improvement later this year and in 2011 — and that’s helping to lift REIT stocks.

“There have been expectations of a commercial estate crash. We expect softness but we think some of the concerns about a crash are overdone, she said. “If real estate investors are waiting for a sell-off and huge bargains, they are not going to come.”

But Cuniff said that investors need to be more cautious when looking at REITs since the sector has already enjoyed a solid run. She said investors shouldn’t paint REITs with the same brush and need to focus more on individual stocks.

Along those lines, Cuniff said REITs that own hospitals and other health care facilities could benefit from the recently passed health care reform bill. One that the Principal Equity Income fund owns is simply called Health Care REIT (HCN). It pays a dividend that yields 5.9%.

Hyun said investors that are optimistic that the recovery is for real should be looking beyond defensive areas like health care though.

Because of the prolonged weakness of the economy, there hasn’t been a rush to build new shopping centers, apartment buildings, hotels and offices. That will help REITs since it should keep prices stable, Hyun said.

He said his firm owns shares of Taubman Centers (TCO), a firm that owns shopping centers that yields 4%, and hotel owner Starwood Hotels and Resorts (HOT, Fortune 500). Starwood is not a REIT, however, and its yield is just 0.4%.

Cuniff said her firm is also looking at REITs that can do well in an improving economy. The Principal fund owns Annaly Capital Management (NLY), a REIT that invests in residential mortgages and yields a whopping 14.7%, and Kimco, which yields 4%.

Merger activity could help REITs as well, according to Hyun. He pointed out how General Growth Properties (GGP), a mall owner that went bankrupt last year, has surged following a takeover bid from rival Simon Property Group (SPG).

Another investment group, led by Toronto-based REIT Brookfield Asset Management (BAM), mutual fund company Fairholme and private equity firm Pershing Square are planning to invest more in General Growth to keep it independent once it emerges from bankruptcy.

“General Growth is highlighting the value in real estate,” Hyun said. “The fact that there is a bankrupt company that is attracting significant investor interest is proving that.”

Equity Interface is an online real estate investment service designed to connect developers and accredited investors. By offering unparalleled research tools and information, Equity Interface empowers members to discover mutually beneficial real estate opportunities. For more information, please visit www.equityinterface.com

The Federal Reserve has held interest rates near zero while also highlighting increased momentum in the US economy’s recovery, during its latest meeting on monetary policy.

The Fed’s nod to a firmer rebound from the deepest recession in decades hints that it is moving closer to dropping its promise to hold borrowing costs at rock bottom levels, suggesting rate hikes could come within several months.

Kansas City Federal Reserve Bank President Thomas Hoenig said the commitment to keep rates exceptionally low for an extended period was no longer warranted.

It said the US labour market was stabilising, which is a view that is more upbeat than at the last meeting in late January, when the policy-setting committee said only that deterioration in the labour market was ‘abating’.

The Fed also said business spending on equipment and software had risen ’significantly’. Again, this is a brighter assessment than the one it gave in late January.

The US economy resumed growth in the second half of last year, and expanded at a robust 5.9% annual pace in the final three months of the year.

The Fed has allowed special lending facilities to close as financial markets have returned to normal after the crisis, and it recently raised the discount rate it charges banks for emergency loans to 0.75% from 0.5%. Fed officials stressed the move was in keeping with the settling of financial markets and was not a precursor to efforts to tighten lending conditions.

Equity Interface is an online real estate investment service designed to connect developers and accredited investors. By offering unparalleled research tools and information, Equity Interface empowers members to discover mutually beneficial real estate opportunities. For more information, please visit www.equityinterface.com

There seems to be many early buds in the recovery of the Real Estate market. Here we have identified two reports from the Real Deal as an example. The first talks about the mortgage industry and the other of the lumber industry. Neither on their own are strong enough to signal that a Spring thaw is imminent but in combination do offer some positive early indicators. Lets hope that they keep on coming to the point where consumer confidence is back towards its previous levels.

Lenders jump back into commercial real estate

February 09, 2010 10:00AM

Despite an anticipated $120 billion in commercial real estate losses between 2008 and 2011, lenders are ready to get back to business. In a Jones Lang LaSalle survey of 60 banks and other financial institutions at the annual Mortgage Bankers Association conference last week, 24 lenders each said they would make between $2 billion and $4 billion worth of commercial real estate loans in 2010. More than half of those surveyed said they were willing to lend $50 million or more toward a single property purchase, up from the $25 million most were willing to lend for a single asset last year. Some lenders were even open to the idea of $150 to $500 million loans, said David Hendrickson, managing director of Jones Lang LaSalle. While banks are still facing substantial losses, most have already set aside reserves or marked down their portfolios to reflect them, and market experts say the opportunity to pick up commercial real estate assets at discounts of 44 to 55 percent off of 2007’s peak prices, as estimated by Moody’s Investors Service, is luring lenders back into the game.

Home improvement retailers see positive signs

February 09, 2010 08:40AM

Following the news that Morgan Stanley upgraded Home Depot stocks, CNBC sat down with two hardline retail experts to discuss what potential gains in home improvement stocks say about the housing market recovery. According to Stephen Chick, managing director of hardline retail at FBR Capital Markets, lumber prices are beginning to rebound — having seen price increases over the last two to four months not matched since 2004, and that could be a positive, though often-underestimated indicator for housing. Michael Lasser, vice president and senior research analyst of hardline retail at Barclays Capital, pointed to an increased demand for appliances. Lasser said it’s too soon to tell whether indicators from stores like Lowe’s and Home Depot mean a full-fledged recovery, but retailers are certainly benefiting from higher transactional volume, stemming from more people moving to new homes and doing improvements and repairs.

Equity Interface is an online real estate investment service designed to connect developers and accredited investors. By offering unparalleled research tools and information, Equity Interface empowers members to discover mutually beneficial real estate opportunities. For more information, please visit www.equityinterface.com

The US economy grew at a faster than expected 5.7% annual pace in the fourth quarter, the quickest in more than six years.

The first estimate put Q4 gross domestic product growth at its fastest pace since the third quarter of 2003. The economy expanded at a 2.2% annual rate in the third quarter. Analysts had forecast GDP, which measures total goods and services output within US borders, growing at a 4.6% rate in October-December period.

Growth was boosted by a sharp slowdown in the pace of inventory liquidation, a factor that could serve to mask the strength of the economic recovery. However, even stripping out inventories, the economy expanded at an annual rate of 2.2%, accelerating from the 1.5% increase in the third quarter, reflecting relatively strong performance from other segments of the economy.

Business inventories fell only $33.5 billion in fourth quarter after dropping $139.2 billion in the July-September period.

The change in inventories alone added 3.4 percentage points to GDP in the last quarter. This was the biggest percentage contribution since the fourth quarter of 1987.

In the last three months of 2009, consumer spending increased at a 2% annual rate, below the 2.8% recorded in Q3 when consumption received a boost from the government’s car scrappage scheme.
Consumer spending, which normally accounts for about 70% of US economic activity, has been held back by the worst labor market in a quarter century.

Business investment in the fourth quarter grew for the first time since the second quarter of 2008 as the drag from the troubled commercial property sector was offset by robust spending on equipment and software. Business investment rose at a 2.9% rate.

The growth of spending on new home construction slowed sharply in the fourth quarter to an annual rate of 5.7% from an 18.9% pace in the third quarter. Export growth outpaced imports, leaving a trade gap that contributed half a percentage point to GDP growth in the last quarter.

Equity Interface is an online real estate investment service designed to connect developers and accredited investors. By offering unparalleled research tools and information, Equity Interface empowers members to discover mutually beneficial real estate opportunities. For more information, please visit www.equityinterface.com

Leading central bankers believe a ‘progressive normalization’ of the world economy has taken hold, driven by emerging economies, according to the president of the European Central Bank.

‘At a global level there is a confirmation of the progressive normalization of the economy,’ ECB chief Jean-Claude Trichet said on behalf of the participants in a meeting of central bankers in Switzerland.
During their first quarterly meeting of the year at the Bank for International Settlements (BIS), they concluded that a global economic recovery was underway.

‘We are in the recovery mode, that is something that is very much due to the emerging economies,’ Trichet said. He said these economies had shown resilience, describing them as being in ‘a more dynamic mode now’.

The ECB chief did go on to warn that commercial banks must ensure that they clean up their balance sheets in the wake of the financial crisis to ensure a steady recovery. ‘We are telling our banks that they have to do themselves everything to reinforce their balance sheet by all appropriate means,’ he said.

The central bankers met the heads of several big banks at the BIS over the weekend to underline the need for a sound financial system to prop up long term growth.

They said afterwards that they hoped that new international standards aimed at bolstering the banking industry’s ability to weather future financial crises would be finalized by the end of this year.
Leading central bankers and national regulators in the Basel Committee on Banking Supervision said last month that they were aiming to strengthen financial requirements on banks by the end of 2012, once their proposals were refined and tested this year.

The reforms, which have been in the offing for several months, are part of the international response to the crisis triggered by the collapse in financial markets and several major ban

Equity Interface is an online real estate investment service designed to connect developers and accredited investors. By offering unparalleled research tools and information, Equity Interface empowers members to discover mutually beneficial real estate opportunities. For more information, please visit www.equityinterface.com

LaSalle Investment Management today released the 2010 edition of their Investment Strategy Annual. A publication that provides an outlook for global real estate markets.

The report notes that the plunge in values has stopped in most major markets it follows and sings of increasing investor confidence are beginning to be seen.

LaSalle anticipates a further re-alignment in the pricing of risk with an increase in deal flow as sellers slowly move from denial to acceptance. Investors should seek an appropriate balance between total risk aversion and inappropriate risk tolerance. The former is already resulting in a surplus of capital targeting a handful of ultra-safe deals.

Jacques Gordon, Global Strategist at LaSalle Investment Management said: “Overall, investors in commercial real estate should be cautiously optimistic about the outlook in 2010. However, as a late cycle participant in the general economic recovery, real estate will behave differently from other asset classes. The income streams from leased buildings weathered the global recession in remarkably good shape, but as leases mature in generally weak markets, net operating income will be under downward pressure in many countries for several years to come.”

“At the same time, in terms of stimulus packages and bail outs, commercial property has been treated quite differently from residential real estate, banking and other industry sectors. And private equity prices have not yet recovered as robustly as stocks or bonds. All these differences mean that real estate’s diversifying power in a portfolio will be restored.”

The firm goes on to state that in 2010 investors can look forward to more rational pricing and, in cases of distressed properties and owners, some hugely interesting opportunities. As they develop investment strategies for 2010-2011, investors with a clear view of the returns they require can take full advantage, says LaSalle.

William Maher, Head of US Strategy, LaSalle Investment Management said, “Investment opportunities in North America will improve but are likely to remain limited in 2010, particularly in the United States and in Mexico. In the US, the best opportunities, both core and higher return, will evolve from the resolution of the large level of maturing and failing loans.”

La Salle go on to recommend that investors in the US focus on low-risk re-priced core properties. A large number of opportunities are expected to emerge from the problems caused by the excessive leveraging of the real estate sector over the past five years.

As regards high return strategies, the areas to focus on include distressed debt (public and private) and a wide range of structures that focus on the provision of “rescue capital” to private real estate funds, developers, individual assets, and lenders.

Not surprisingly, the major risks to Commercial Real Estate according to the report is with the capital markets, which are expected to be the main driver of performance, while economies are weak. Real estate capital markets could be quite volatile in the years ahead, says LaSalle. The unintended consequences of monetary and fiscal stimulus policies could lead to too much money flowing back into property ahead of a solid recovery in fundamentals. This excess liquidity risk is already building in China and, to a lesser extent, the UK. To manage this risk, investors should maintain a strict discipline that focuses on achieving a required return with realistic and diligent underwriting.

Equity Interface is an online real estate investment service designed to connect developers and accredited investors. By offering unparalleled research tools and information, Equity Interface empowers members to discover mutually beneficial real estate opportunities. For more information, please visit www.equityinterface.com

During the last number of golden years in the Real Estate market, the only word that investors wanted to hear was ‘returns’. Now, according to Ernst & Young, this is being replaced by another ‘R’ word: risk.

Ernst and Young are witnessing a marked change in the priorities of large Real Estate investment firms. When once, at the height of the real estate boom, they were focused on generating the highest possible returns for their investors now that attention is primarily targeted at managing risk.

In material documented from market research on over 40,000 client meetings globally, Ernst and Young said that firms should be developing a “plan of action” if they are to benefit from the downturn. That plan needs to focus on capital availability, reevaluating the business model and risk management.

With almost 75% of real estate executives anticipating a “permanent change” in the risk management of their organizations, Ernst & Young said everyone had to learn lessons as they tried to prepare for “success”.

In the ‘Lessons From Change’ report, the firm added that real estate companies need to be adept at controlling the expectations of investors who were used to seeing exorbitant returns in times past. They now need to “accept lower returns as some companies focus on lower yielding but lower risk investment”.

The issue of increased regulation is also something that the report identifies. Global Real Estate leader Howard Roth said this would be one issue facing all investors, particularly private equity and real estate funds. Here there is a growing demand and expectation for greater disclosure of investment plans and asset verification.

Dean Hodcroft, Ernst & Young’s Real Estate leader for Europe, the Middle East, India and Africa, continued by stating that: “Two years ago, real estate executives spent most of their time on new deals. Now they spend most of their time firefighting: protecting assets, controlling costs and, most importantly, managing cash flow.”

Equity Interface is an online real estate investment service designed to connect developers and accredited investors. By offering unparalleled research tools and information, Equity Interface empowers members to discover mutually beneficial real estate opportunities. For more information, please visit www.equityinterface.com

Lending conditions for the commercial real estate industry continued to worsen in the third quarter, according to an index by San Francisco based Banc Investment Group. The index is supported by data from the US Bureau of Labor Statistics, CB Richard Ellis, Grubb & Ellis and Reis.

The index dropped 10.6% to 63.67 in the third quarter from 71.24 in the second quarter, which was an 11.6% decline from the first quarter.

The BIG CRE Index is essentially a forward-looking measure of strength of Commercial Real Estate market conditions for community banks. Values are derived from third-party providers and data collected by Banc Investment Group’s consulting services group, which provides a loan pricing model for community banks nationwide.

In summary, conditions in the industrial sector fell 21.2% representing the largest fall, according to Banc Investment Group. Retail sector lending conditions dropped 7.7% while the the office sector dropped 7.1%. Multifamily fell 9%.

This data foretells a testing lending environment for the fourth quarter of 2009 and into 2010.

Retail

•    The retail sector of the index fell to 60.89 in the third quarter from 65.99 in the prior quarter, down 7.73%. Half as much as compared to the second quarter.
•    For neighborhood and community shopping malls, rents fell an average 0.7% during the quarter. Vacancy rates at neighborhood and community shopping malls exceeded 10%, while rates rose nearly 2.5% at regional malls. In both subsectors, the rate of deterioration is only about half that of the second quarter.
•    More than six in ten markets experienced a rise in vacancy rates, and more than 95% recorded negative rent growth.
•    Lending conditions benefitted from a modest improvement in retail sales (less gas and autos). Sales rose 0.6% in August and 0.4% in September.

Industrial

•    The industrial sector of the index fell to 43.97 in the third quarter from 55.84 in the prior quarter, which is a decrease of 21.27%. This was slightly tempered in comparison to the decline between the first and second quarter.
•    Vacancies rose again, up an average of 3.4% in the quarter.
•    With inventory levels sinking, industrial production has turned positive for every month in the third quarter.

Multifamily

•    The Multifamily sector of the index fell at an increased pace of 9.06% to 76.74 in the third quarter from 84.39 in the previous quarter.
•    Unemployment rose 30 basis points from June through September. The average vacancy rate increased 1.3% over the quarter to a 23-year high. The vacancy rate is expected to climb further, although at a slower pace. In tandem, rent growth dropped 30bps.
•    Across the U.S., about 65% of metropolitan locations reported a rise in vacancies, while more than five out of ten saw rent decline.

Office

•    The office sector of the index fell to 73.07 in the third quarter, down 7.19 % from 78.73 in the prior quarter.
•    The sector posted negative net absorption levels with vacancies rising nearly 4% over the third quarter, despite only half the amount of space coming online as the second quarter. Nearly 85% of Metropolitan areas experienced a rise in vacancies.
•    Year-to-date, average rents dropped 7%, with nine in 10 areas suffering rent declines.

Real Estate has long been labeled as a finite commodity. After all, as we have heard so many times before, there is only so much land available. As true as it may seem, us humans seem to be doing everything in our power to push these boundaries and prove that this may not be the case!

The rapid pace at which technology is being developed and introduced to the market can be thanked for this. As these advances continue, more and more real estate opportunities raise their heads.

Who would have thought that church steeples would be the big real estate earner in the late 90’s! People would have laughed you out of the room if you had made such a claim. However, one invention suddenly made the steeple a viable business opportunity. As many will remember, telecommunications companies such as Sprint PCS and Pacific Bell Mobile Service raced to build antenna networks to transmit their new digital cellular phone service and church steeples seemed to be the ideal spot to transmit from.

More than ten years after the church steeple phenomenon a new technological advance has spurred a fresh demand for real estate. It now seems that flat roofs are set to take off as we move from worshipping the skies, to worshipping the sun. Solar power is becoming more and more viable as an alternative source of energy and where best to harness this power than a flat roof, possibly even on your private residence.

The trend first began with deals between energy companies and various large manufacturing and warehouse operations to install solar panels on their premises in return for a fee.

The energy companies have now started to tap the residential sector. The inherent logic of this development is obvious; once they’ve got local authority approval energy companies can extend their ’solar parks’ quickly and with relatively little hassle by fixing normal residents up with solar power. Homeowners are interested because they get a fee for renting out their roofs to professionally managed solar panel operators.

Duke Energy in North Carolina is one such company following this route. It recently became the latest company to announce it would start renting the roofs of ordinary houses for solar power generation. The energy giant will rent 425 roofs across the state as early as next year.  You could argue that Duke, which aside from the Carolinas is also present in parts of the Midwest, found a vital niche because not everybody can afford decent solar panels and this offers people the chance to participate in the solar revolution.

Indeed, throughout the United States, homeowners are being compensated by their energy utility to have solar panels installed. This is arising from the power companies’ urgent need for roof space. They are in a race against the clock to replace ever increasing portions of the regular energy supply by power sourced from renewables.

Independent companies are also getting in on the act of offering people the option of renting out their roofs. Outside renewable energy providers will pay for, install, own and operate the solar systems. The homeowners simply agree to pay a rental fee for the solar electricity generated – based on their usage at the previous year’s rate. Cost reductions of around 20% are feasible.

A good example of this in operation is the Delaware renewable energy company Citizenre which offers customers living in states that have a net metering law the option of renting panels for one, five or twenty-five years. These customers pay a per-kilowatt flat fee instead of the utility bill. Citizenre then sell the excess power generated back to the local utility.

Looking towards the future, it is worth considering how advances in technology can result in the further inception or birth of fresh real estate. Social networking, instant messaging, VoIP, and countless other advancements are leading us down the path to distance communication whereby there will feasibly be no benefit from having company staff in situ. It is not a wild leap to suggest that in the not too distant future, these developments will have led to colleagues connecting with each other from the sanctity of their own homes.

Where does this leave the vacant office blocks? Real Estate is a finite commodity – we beg to differ!

Equity Interface is an online real estate investment service designed to connect developers and accredited investors. By offering unparalleled research tools and information, Equity Interface empowers members to discover mutually beneficial real estate opportunities. For more information, please visit www.equityinterface.com