Predicting Real Estate Trends

By Matt Wrye, Staff Writer for San Bernardino Sun

Thomas Galvin is sitting on a gold mine of knowledge, and he's jumping at the chance to do something with it.

The 27-year-old research associate with Colliers International commercial brokerage firm in Ontario stays busy crafting all kinds of market reports on office and industrial spaces in San Bernardino and Riverside counties. Hundreds of numbers, statistics and dollar signs flood his brain - and desk - every week.

Sound boring? Scratch beneath that surface and you'll find a whole lot more than you bargained for.

His work day's end marks the beginning of a hobby which may propel him into the regional spotlight as one of the foremost authorities on predicting local commercial real-estate trends.

By using a popular technique called "econometrics," Galvin is slowly developing a system where he feeds an array of Inland Empire real-estate and demographic data into theory models.

The outcome: a darn good estimate of what the future holds for local commercial real estate as more people move to the area.

"There's a lot of information out there that doesn't get used," Galvin said about the stacks of data-laden paper lying around his office. "I want to collect that info to forecast and explain things. A lot of times you can say something should happen, but you don't know to what extent it's going to happen."

Galvin wants to be the John Husing of commercial real estate. He's read almost everything the Redlands-based economist

publishes, but he's never met the man in person. Husing has become the source for providing economic forecasts to local governments in the Inland Empire.

For now, though, the young researcher says he'll have to "connect the dots." He keeps track of lease, sale, construction and rental activity, working for a clearer view of how population trends affect those activities.

"Right now I'm only looking at three dots, but I want to bring in a thousand dots and paint a more robust picture," Galvin said. "That way, when people see the rental and sales prices, they can see the facts behind it. Being able to say, `For every 1,000 people that move to the Inland Empire, sales prices rise by so much' - it's a more academic approach to explain what's going on out here."

Galvin topped off his psychology degree with a quirky "paper-rock-scissors" graduate thesis at the University of Nevada, Las Vegas. He used computer models of the game to explore if humans could adopt a dominant strategy and how risk and uncertainty affect human behavior.

"He's not content just to take the path people have gone in the past," said Brad Wimmer, economics professor at the university. "He's a self-starter, he's bright, and he doesn't let conventional thinking get in the way of trying to find an answer to a problem."

"Nobody is really taking it very far, mainly because there's a lot of math and theory that goes into it," Galvin said. "All that stuff I learned in college, I want to apply to my job here."

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Courtesy San Bernardino Sun
matthew.wrye@sbsun.com