Media and Real Estate Reactions

We have a leadership that's anti-business,complained billionaire Sam Zell,Co-Founder and Chairman of Equity Group Investments,who is steeped in his real estate and media conglomerate businesses.You're not gonna get growth unless the business community signs on.The National Labor Relations Board went after Boeing,the biggest exporter in America.I think the whole world is slowing;the world is wondering what's next.High levels of uncertainty are not good for investment.We've moderated our risk.I don't think the office market in the U.S. is in great shape.D.C. is particularly weak.There's very little robust growth in the office market across the country.I think the single family market is different than other real estate.There's an obvious oversupply of housing units,and it's relative to affordability as well.Supply/demand is getting a little better;but the ability of people to qualify for a loan isn't getting better,Mr.Zell noted.Equity Group Investments is a diversified international holding company.Started in 1968,it is one of the largest owners of apartment buildings and manufactured homes.Its portfolio notably includes The Tribune Company,which is a major newspaper publisher and television broadcaster,as well as energy,transport and communications interests. Boeing(BA)

Early Edition:Real Estate Check-up

Real estate and media magnate Sam Zell,Chairman of Equity Group Investments,says that basically we're moving to a position where single family home prices stop going down.It's the key to everything.That's where consumption comes from.Once housing stabilizes,it will stabilize the rest of the consumer sector.They must have confidence in their biggest asset.There will be a slow improvement in residential real estate this fall,Mr.Zell predicted.
Sam Zell described the commercial real estate sector as being underwater.He doesn't think we'll see any foreclosures of institutional assets until 2-3 years from now,when they can no longer cover.Every day you don't sell,you buy,Mr.Zell observed.Companies are,to a large extent,in pretty good shape.
Mr.Zell,a diminutive man with a goatee,also owns Tribune Company,parent of The Chicago Tribune and The Los Angeles Times,as well as Newsday and 23 T.V. stations.I don't have emotional attachment to assets,Mr.Zell stated-just to my family.

Cubs Sale Goes Ahead

The sale schedule of the Chicago Cubs will stay as announced,owner Sam Zell stated.We've gotten three bids.I do not think the Cubs sale will be impeded by The Tribune Company bankruptcy.As for the rest of the business world,our system is based on debt and equity,and one of those elements-debt-is missing.The business community is suffering from the financial crisis.I think the Troubled Asset Recovery Program will succeed after the first of the year.Should I have bought Tribune? My head only functions looking forward.This crisis too shall pass,the magnate Sam Zell philosophized.

Commercial Real Estate's Health

With a 2006 or 2007,we would not have had any issue at Tribune,Sam Zell maintained.It was a tsunami.Business eroded much faster than we had expected.The biggest problem everyone has right now is a lack of visibility.It's very hard to see how the economy will be next year.When you look at commercial real estate,everything has to come down to supply and demand.Because we haven't built since 2007,that will cushion the blow to commercial real estate.I don't think there will be any diminution of cash flow.There is less excess inventory in office space than in previous crises,said Sam Zell,who is Chairman of Equity Group Investments.

Zell Assesses Tribune Bankruptcy

The Tribune Company recently filed for Chapter 11 bankruptcy.It holds The Los Angeles Times,The Chicago Tribune,The Baltimore Sun,several T.V. stations and the Chicago Cubs baseball team.The team wasn't included in the filing.The firm has suffered a 20% reduction in gross revenue,owner Sam Zell revealed.In the end,my responsibility is to preserve the value of the company and ensure it goes on into the future,Mr.Zell said.The company has significant positive cash flow as long as it's not making debt payments.Going forward,we now have the time to focus on consolidation,Mr.Zell asserted.