[quote=SK in CV]
BX is a primarily an PE firm. “Hedge” doesn’t apply to everything it does. That’s kind of what I was talking about. “Hedge fund” is now too often used to refer to all private equity. “hedge fund” and “private equity” are not synonymous. It’s current debt to equity is about .5 (which is NOT highly leveraged). But more importantly, BX doesn’t own the RE. It manages funds that own the real estate. If it owned the RE, it would show up on its balance sheet. It doesn’t. As far as I know, all the specific financial info for their RE funds is private (hence “private” equity).[/quote]
Private equity often employs leverage. The concept of leveraged buyout was invented by private equity. Of course this thread is about North County Coastal so I probably shouldn’t have brought PE into the thread at all.
North County Coastal is a special sub market that is far more likely to be effected by the Sorrento Valley economic center of high paying jobs than anything else. QCOM’s health is probably much more important than what private equity is doing if anything.
Housing for the marginal buyer is a highly leveraged asset in most cases. As long as carrying costs stay low (interest rates) and leverage available stays high (5% down or less) the housing market will be fine. As soon as one of those things goes away it will have some difficulties.
