Real estate doesn’t always go up. NYC pensions just proved it the hard way. Many people think of real estate as the “safest bet.” But the New York City pension funds just proved that even billion-dollar players can get burned. Back in 2012, NYC’s public pensions poured hundreds of millions into rent-stabilized apartments. On paper, it looked like a no-brainer: preserve affordable housing, generate steady returns, and ride long-term appreciation. What could go wrong? Policy shifts. In 2019, Albany rewrote the rent laws, slamming the brakes on rent growth. Combine that with rising expenses and aging buildings, and values collapsed. The pensions have already lost over $120M—and that’s just what’s been realized. Real estate doesn’t always go up. Government policy can wipe out your underwriting assumptions overnight. And I can’t help but see the parallels to 2021–2023. Investors were buying deals at cap rates that made no sense relative to history. Cheap money blinded people to risk. Fast-forward to today: I’ve seen nine deals in just the last couple of months that are already being sold by lenders,foreclosed, notes traded, extensions expired. Some big funds will ride it out. But many syndicators and smaller players are getting caught. Real estate cycles always look obvious in hindsight. The question is: how many of the 2021–2022 buyers will still be calling it a “no-brainer” when the dust settles? Here is the article from Bisnow if you want all the details… https://lnkd.in/ewvXGUdB