Working Paper #416
Real Estate: Past, Present, and Future
Samuel Zell
Commercial Brokerage Equity Market Investing
Sam Zell reflects on the continuing evolution of the real estate industry, of which he is an icon. He describes the arbitrage potential of an average 6 percent interest rate relative to an inflation rate of 9 percent, the birth of opportunity funds, the development of the con-cept of the “real estate elitist,” and the existence of a market – composed of relatively small players who could borrow money because they had connections with local banks – transformed to an industry offering an astonishing opportunity for marketing. He pre-dicts that the CEOs of the industry leaders of the future will be much more operations-oriented and may have no real estate experience.