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Is Commercial Real Estate Headed for Another Bubble?

Barry Sternlicht, Chairman and CEO of Starwood Hotels and Resorts
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Barry Sternlicht, Chairman and CEO of Starwood Hotels and Resorts

I thought comments by Barry Sternlicht, chairman and CEO of Starwood Capital Group, about the quickening race upward in commercial real estate values are worth noting.

When cap rates on deals fall as low as 3 or 4 percent, it can be a sign that things are frothy and Sternlicht certainly seems to think so.

I've had a number of people here in Davos remark to me that the commercial real estate market in London reminds them of "2007 all over again".

Will the search for yield end badly yet again?

There are plenty or reasons why it may not, but this recent run up bears watching.

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