This is a summary of the June 28, 2016 meeting of the ULI Chicago District Council, which gathered at LondonHouse Chicago to hear an expert panel of professionals discuss the state of the capital markets, including the tumultuous impact of Brexit, the recent referendum in which United Kingdom voters narrowly expressed their desire to leave the European Union.

The panel–featuring a pension fund advisor, a national developer, a leading private equity group, and one of the nation’s largest real estate lenders–covered market sentiment, lending parameters, investor preferences, and capital availability, among other topics.

The moderator for the session was Mary Ludgin, Director of Global Investment Research, Heitman LLC. Panelists were Kevin Hites, Chief Investment Officer, The John Buck Company; Christopher Kosonen, Managing Director, J.P. Morgan; and Jeff Quicksilver, Managing Director, Walton Street Capital, L.L.C.

Given the volatility that has characterized the first half of 2016, it was only fitting that the panel discussion began on a topic that, until last week, wasn’t really on the radar: Brexit, which has already had significant ripple effects in every corner of the global economy.

In response to moderator Mary Ludgin’s inquiry about Brexit’s initial impact, Kevin Hites said lenders and investors who were already “on the fence” are likely to be “more firmly planted on the fence or jumped off the fence and are running for the hills. So that definitely affects us.”

Also, in the coming months, his firm will be “more selective” and focused increasingly on core locations. “I think the projects that are more on the fringe,” said Hites, “are going to be very difficult to get built, financed, acquired.”

According to another panelist, “Our spreads are widening while the index is falling. The coupons are more or less the same in our space.”

And Jeff Quicksilver placed Brexit in the context of the last year that has seen much “global volatility” in the financial markets.

“This is another level of uncertainty and volatility in the markets,” Quicksilver said. “For the real estate market, you’ve seen interest rates fall. That’s probably a sign you’re going to have continued accommodative monetary policy.”

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