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Research Sponsors Meeting A Research Sponsors Program meeting was held in New York City on May 28th at The New York Penn Club. Research Sponsors and Executive Committee Members gathered to hear Wharton Professor Jeremy Siegel, Palmer Professor of Finance, present "Are Stocks Still Right for the Long Run?: Thinking about the Market after the Bubble Burst." This is the third of a new type of program, with the goal of increasing interaction and discussion between faculty and Research Sponsors on topics of significant importance to the real estate industry. During lunch, Professor Joseph Gyourko, Martin Bucksbaum Professor of Real Estate and Finance and Director, Zell/Lurie Real Estate Center, discussed current research initiatives and the future research agenda of the Zell/Lurie Real Estate Center. Zell/Lurie Working Papers related to these initiatives can be found on the Center website Professor Siegel then began his presentation by discussing the economic factors that favor long term P-E ratios in the low 20s. He noted that trend earnings are now about $50 per share on the S&P 500 index which implies a 1100 – 1200 fair value for the index. From those levels, one might reasonably anticipate long term stock returns of between 5 to 7 percent after inflation. Therefore owner-occupied real estate has a better after-tax return and REITS still offer good returns. The presentation was very well received and engendered a most spirited discussion.
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