Schall described the acquisitions market in light of the strong fundamentals.
"It is more difficult," he said. "Owners of property are pretty pleased with the current conditions. They see the economy getting better. Rent growth is good amid very low interest rates, which provides a good cash flow, so they're reluctant to sell. Buyers on the other hand, have seen a lot of rent growth already occur and are concerned about overpaying."
Schall also described the company's development pipeline and any potential concerns about a shift in supply and demand.
"The good news is that we don't produce a lot of apartments on the West Coast," he said. "Generally, the supply of new housing in total both for sale and for rent is less than 1 percent of stock over longer periods of time. Still, our strategy on the development side is to be an early-cycle developer. We have nine communities under construction right now, for an aggregate estimated cost of about a billion dollars. We expect to slow down our development activity as we get further along in the economic cycle, but we're very well positioned right now."
By Mitch Irzinski and Michael Schall, president and CEO of Essex Property Trust (NYSE: ESS), joined REIT.com for a CEO Spotlight video interview in Chicago at REITWeek 2013: NAREIT's Investor Forum.
Essex focuses on multifamily properties, primarily on the West Coast. Schall discussed the fundamentals in his core markets.