Letters to the Editor

//October 12, 2009

Letters to the Editor

//October 12, 2009

Desiring a real choice in doctorsWe encourage readers to write letters concerning New Jersey business issues. Please keep letters to fewer than 400 words. We reserve the right to edit letters and reproduce them at njbiz.com. Please sign your name and include a telephone number. List your town, or if you prefer, your title and company’s name. Send letters to

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Desiring a real choice in doctors

I want to share with you some perspectives that I’ve seen as the president of the Morris County Chamber of Commerce. Earlier this year, our chamber invited interested citizens to health care insurance reform events. These events were held long before the raucous August town hall debates you might have seen on your local news. Although most of the people at our events had health insurance, they expressed extreme frustration with the current system.

We heard from many who want to have a real choice in choosing their doctors and the treatment they receive. They don’t want insurance companies to make this decision, and they don’t want to end up in a public plan because their employers or others have made decisions that default them to a government-run program.

Based on what I heard at these events, I also believe they would be opposed to a government-run co-op that was recently proposed in the U.S. Senate Finance Committee health care insurance reform bill. Such a co-op will no doubt operate on a different playing field and under different federal, state and regulatory rules than private insurers.

Whatever you think about the recent behavior in town hall meetings, many people don’t trust the public plan option, and they believe that a competitive marketplace will birth a health care system that will give them the options they need and can afford.

Paul Boudreau, president

Morris County Chamber of Commerce


A resource for small businesses

The series over the past several months from NJBIZ reporter Beth Fitzgerald on resources for small business is great. What a wonderful and positive contribution to helping the New Jersey economy recover. Thank you for moving the ball forward.

Maureen Tinen, president



Sun rises on apartment REITs

To say that looking for bright spots in the current real estate market is a challenge is probably the greatest understatement of the recession. However, the sun is definitely rising on real estate investment trusts for apartment buildings.

Apartment REITs continue to benefit in this real estate correction, because the number of renters and the duration of their stay has increased. Owning a home remains unaffordable for many people, as the unemployment rate has remained lofty for quite some time and lending standards have tightened. Additionally, rising unemployment means less office space is needed, which is obviously not good for office REITs. The weaker economy also means lower consumer spending, which is certainly a negative for retail REITs. From the investors’ perspective, apartment REITs continue to be viewed as a relatively safer segment within the broader REIT industry because of comparatively stronger balance sheets.

Demographics favor the apartment market in a very big way. The children of baby boomers are going to need somewhere to live very soon, which will be a shot in the arm for the apartment market. Additionally, current and future renters are very unlikely to make a quick departure from the apartment market, as financing for potential homeowners will continue to be difficult to come by post-recession.

Cash is king in the current market as obligations come due. Apartment REITs can use their buildings as collateral to borrow from Freddie Mac and Fannie Mae, providing access to seven- to 10- year debt at 5.5 percent, which is approximately a 2 percent discount over the borrowing options available to commercial and retail REITs.

Apartment REITs with strong balance sheets and access to capital will thrive in this environment. Condor Capital recently initiated a strong position for our investors with AvalonBay Communities, an Alexandria, Va. company with an office in Woodbridge that is very well-positioned for success in the current downtrend.

AvalonBay’s focus on luxury apartments in urban regions, including the greater New York City area, protects it from excessive competition. This emphasis on upscale, high-rise apartments also provides a barrier-to-entry advantage, since construction is the most expensive. Additionally, landlords operating luxury apartments have the benefit of making greater concessions to keep price-sensitive tenants from leaving.

Apartment REITs that are well-capitalized with liquid assets to meet maturing debt will do very well over the next few years, and will be very attractive for patient, long-term investors.

Ken Schapiro, president

Condor Capital