Key Takeaways
- Each cycle phase (recovery, expansion, hyper-supply, recession) requires a different acquisition and disposition strategy.
- Countercyclical investing requires maintaining liquidity during expansion and deploying capital during recession.
- Late expansion signals include construction exceeding 3% of inventory, cap rates at historic lows, and aggressive lending.
- Recession preparation (reserves, low leverage, operational optimization) must begin during the expansion phase.
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Test Your Knowledge
1.What is countercyclical investing?
2.What financial preparation is needed during expansion to invest countercyclically?
3.What signals indicate the transition from expansion to hyper-supply?